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George Bush 

and the 12333 

serial murder ring 

Ocroher 1996 






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George Bush 
and the 12333 
serial murder ring 

by the Editors of Executive Intelligence Review 


v George Bush and the 'Ibykus principle' 

by Lyndon LaRouche 

1 New revelations tie Palme murder to Bush, 
Thatcher-linked arms cartel 

4 Bush-Thatcher 'zones of conflict' 
6 Williamson's 'confession' 
8 Ricci and Williamson on the GMR group 
13 International coverage of the 'South Africa 
connection' Documentation 

17 John Train: Wall Street's man in Bush's 
secret government ^ 

18 John Train's British, Swedish financial ties 
27 Appendix: The Train salon, in the legal record 
Excerpts from a 2255 motion for a new trial by 
attorneys for Lyndon LaRouche, William 
Wertz, and Edward Spannaus. 
30 The Goldsmiths and the new 'Murder, Inc.' 

32 The Olof Palme assassination and coverup, 

Case Studies: 

38 The LaRouche case and the Palme 

42 The Club of the Isles and the international 

weapons cartel 

48 The death toll rises 

49 The mysterious death of Uwe Barschel 
51 Cools and Bull: two murders in Belgium 
53 India's former prime minister, Rajiv Gandhi 
56 Who killed Yitzhak Rabin? 

56 The Jonathan Institute: neo-cons, British agents 

59 The Ledeens and Temple Mount 

60 The 'Temple Mount' patsy factory 
61 The case of Cyrus Hashemi 

63 George Perry and the Tabatabai bust 

64 Some other strange deaths 

66 'Paris Review' goes to Kabul 

67 The 'Arc of Crisis' in conflict and war 
70 Major terrorist incidents since Clinton's 

71 Bush-Thatcher 'secret government' 
operations: 1979-96 

86 Bibliography 

Photo and graphic credits: Pages vi, 2, 1 1, 26, 30, 57-60, 73, 82, EIRNS/ 
Stuart Lewis. Pages 5, 67, EIRNS/John Sigerson. Page 54, UN Photo 
16625/Saw Lwin. 

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George Bush and 
the Tbykus principle' 

Shakespeare's Hamlet said: "Murder, though it have no 
tongue, will speak." 1 History, at last, is delivering poetic jus- 
tice to two among the most hateful world figures of the 1981- 
1992 interval: former British Prime Minister, Lady Margaret 
"MacBeth" Thatcher, and former U.S. Vice-President, and 
President, George Herbert Walker Bush. So, as in Friedrich 
Schiller's celebrated poem, "The Cranes of Ibykus," it is the 
international drug-traffickers, thieves, and murderers of 
bloody 1981-1992, who are now exposing themselves, and 
also their former masters Thatcher and Bush, to the long- 
overdue justice of "the Furies." 2 So, as in Schiller's poem, 
during recent weeks, growing numbers from among long- 
standing cronies of Thatcher ' s and Bush ' s orgy of world-wide 
drug-trafficking, weapons-trafficking, not-so-secret wars, 
and just plain murder, are pointing bloody fingers at one an- 
other, and, also, at their former masters. Let Thatcher, Bush, 
and their accomplices, now tremble: truth appears, and no 
more weapon than that truth itself, will render to the memories 
of these pirates, the dramatic justice of which William Shake- 
speare wrote. 

During the several past weeks, governments in Europe, 
and elsewhere, are now trembling as by the warning shocks 
of a major political earthquake. Scandals hitting high levels 

murdered victims are so evoked, all pointing in the direction 
of Thatcher, Bush, Kissinger, and their ilk. Each week, the 
press of western Europe is kept off-balance by a fresh flood 
of such reports, each batch expanding upon the shattering 
revelations of a few days before. 3 

This EIR Special Report provides a summary, and over- 
view, of the most important facts and supplementary allega- 
tions afoot thus far. In part, we write as veteran investigators, 
but also as eyewitnesses of the often bloody carnage of those 
Thatcher-Bush years. From the offices of Washington's Old 
Executive Office Building, throughout the capitals of those 
nations where Thatcher, Bush, et al., ran their terrorism, and 
drug-running, through Central and South America, and in the 
Middle East, in Africa, and in Europe, we were among the 
leading representatives of the underdogs, the victims of this 
carnage, face-to-face, against Kissinger, Bush, Thatcher, the 
late Roy M. Cohn, and the pack of scoundrels whom they rep- 

So, as in the case of the recent useful work of the San Jose 
Mercury News, we had an eyewitness's inside story on the 
Contra drug-running, approximately a decade and a half be- 
fore the Mercury News newspaper broke its story. On many 
of the most important facts of that story, we, as veterans of 


History, at last, is 
delivering poetic justice 
to two among the most 
hateful world figures of 
the 1981-1992 interval, 
former President George 
Herbert Walker Bush 
and former British 
Prime Minister, Lady 
Margaret "MacBeth" 

Africa, Europe, and Asia, shuddered in fear of Thatcher and 
Bush, at the mere mention of the facts we knew first-hand. 
Now, however, just as the Mercury News's well-documented 
treatment of the Contras' cocaine-pushing, added a small, 
but politically crucial piece to the evidence already in our 
possession, so the tattle-tales of the Thatcher-Bush Iran-Con- 
tra murder-ring, provide us, now, the added leverage to report 
our insider' s knowledge of the continuing, world-wide opera- 
tions of our aging old adversaries, Kissinger, Thatcher, and 

The question is: What are you, the reader, going to do 
about it? Here, in two successive EIR Special Reports,* you 
now have, as if served on a platter, two connected revelations 
of the criminality of George "mad dog" Bush, and his cronies, 
during the 1981-1992 interval. Although out of public office, 
Bush is still a powerful international, and national figure be- 
hind the scenes, one of the vilest, meanest, and most corrupt 
figures in any part of today's world. Your freedom, and that 
of our nation, hangs upon our ability to purge our institutions 
of the evil, bootleg, unconstitutional power, represented by 
the secret government created for George Bush, beginning 
1981, under the title of Executive Order 12333. 

There are two ways to lose a war, and your freedom. One 

is to be defeated in war; another, is simply not to fight it. These 
presently ongoing, fresh exposures of Thatcher and Bush, are 
like a Heaven-sent gift. These facts present an opportunity 
for our government, our citizens, to free themselves from 
continued bloody abuses, by secret, armed government, op- 
erating from within the precincts of our military's Joint Chiefs 
of Staff. 5 Sometimes, true facts are the most effective of the 
weapons by means of which an entire people may regain its 
lost freedom., This — right now— is such a time. 

George 'Kid Twist' Bush 

What tends to cause many people to defeat themselves 
before the battle starts, in facing tyrants, is the widespread, 
popular delusion, that the tyrant is either too powerful, or 
simply too popular, to be engaged. Popular opinion, in its 
habituated credulity about such matters, fails to grasp the fact, 
that, often, the tyrant is, at bottom, a stage figure. 6 Consider 

4. The first report is, Would a President Bob Dole Prosecute Drug Super- 
Kingpin George Bush? (Washington, D.C.: EIR Special Report, Septem- 
ber 1996). 

5. The channel within government for the armed operations of the Contra 
operations, for example, were not run through CIA channels, but under the 
Joint Chiefs of Staff, under the cover of the logistics (support) section of 
JCOS Special Operations. Vice-President Bush's control over this section 
of the U.S. military command, was exerted under U.S. National Security 
Decision Directives numbers 2 and 3. See, Would a President Bob Dole 
Prosecute Drug Super-Kingpin George Bush?; pp. 14-31 . 

6. Unlike Soviet General Secretary Josef Stalin, who was an actual tyrant, in 
his own right. 

vi October 1996 

EIR Special Report 

four examples of such stage figures: Sir George Jeffreys of 
King James IPs "Bloody Assizes"; Adolf Hitler; Margaret 
Thatcher; and, outgoing Massachusetts Governor William 
Weld's long-standing political ally, George Herbert 
Walker Bush. 7 

The most delicious summary of the career of Jeffreys, 
is to be found in Thomas Babington Macaulay's celebrated 
prose, The History of England. Macaulay introduces Jef- 
freys, as a foul-mouthed rogue of a judge, in a court for cases 
of prostitution and petty thievery. Later, Macaulay's Jeffreys 
is elevated to the peerage, not for reason of any virtue in him, 
but, rather the political suitability of his scholarly, judicial, 
and moral deficiencies. 8 He became the foul-mouthed, scantly 
literate wretch, Lord Jeffreys of the "Bloody Assizes." In the 
end of his account of Jeffreys, Macaulay presents his subject 
fleeing the pages of history, attired in no more than his night- 
shirt, just beyond the reach of a pursuing host of outraged 
English subjects. Jeffreys was one of the most justly hated 
men in the annals of English injustice, but, within himself, 
nothing more than just one more contemptible, talent-free 

Adolf Hitler, as a person, presents us an essentially analo- 
gous social type. The actual Hitler was the work of some 
horrid "Pygmalions" from the Liszt- Wagner circle of the Brit- 
ish aristocrat Houston Stewart Chamberlain. Hitler was a se- 
lected and groomed political 'Trilby," put on stage by his 
sponsors, to play the vulgar sort of tragic role which even 
persons of such vulgarity as Lord Palmerston's Bakunin and 
his fellow bomb-thrower, Richard Wagner, 9 might be capable 
of conceiving: a stage-figure by means of whose leading role, 
a Germany, and much of Europe besides, might be destroyed. 

7. George Bush is a member of the same Walker family, on his mother' s side 
[Cf. Webster G. Tarpley and Anton Chaitkin, George Bush: The Unautho- 
rized Biography (Washington, D.C.: EIR News Service, 1 992)], as Governor 
Weld's former associates of the Walker clan, in his family firm of White 
Weld. It was one of those White- Weld associates of the Walkers, Weld's 
cousin, Ogden White, Jr., for whom William Weld, as Boston U.S. Attorney, 

Excepting the manner of their leaving political office, a 
modern Plutarch would find relevant parallels between the 
stage-roles performed by Hitler and Prime Minister Margaret 
Thatcher, the latter fairly described as a "Trilby" with a most 
unmelodic voice. She was created to serve as a Tory parody of 
Winston Churchill's English Nemesis, Labour's memorable 
Bessie Braddock: a political figure of a type easily recognized 
by the British voter, a mean British nanny who will assuredly 
pinch the children cruelly when the parents are not watching. 
She was as shallow-minded as a Hollywood sex-goddess off- 
screen, and just as nasty, and, according to some recent ac- 
counts, with a certain nepotic touch of venality. Her point of 
kinship to Jeffreys, and Hitler, is, that she was prepared for, 
and placed in her position in government, to be used to the 
advantage of that Venetian type of financier-oligarchical in- 
terests which placed her there. I0 

A modern Plutarch must admit, that George Bush differs 
from Jeffreys, Hitler, and Thatcher, in one notable feature. 
The first three were the picaresque offspring of a richly de- 
served obscurity. George Bush is, in combined social and 
intellectual standing, the trusted runt of an American patrician 
litter. The difference does George no credit, but it has func- 
tional significance, nonetheless. 

Perennially petulant George has done much evil, but he 
is no "Evil Genius." Intellectually and morally, he is fairly 
regarded as "Forrest Gump's Evil Twin." His significance is 
that his father, the former Senator, and Dwight Eisenhower 
golf-partner, Prescott Bush, was adopted by one of the most 
politically powerful financier-oligarchical families in the 
U.S.A., that of fellow-Bonesman Averell Harriman. Aver- 
ell's position, in turn, was that of being a son of the E.H. 
Harriman who rose to fame and power during the 1890s, 
representing the Union Pacific railroad interest of Britain's 
Prince of Wales Albert Edward (later King Edward VII). Har- 
riman also became the business agent for the Russell Trust, 
the formerly opium-trading, financier-oligarchical interest, 
behind Yale's gloomy Skull and Bones cult." 

As Tarpley and Chaitkin document, George never could 

privately brimming with the hateful grudges of a Three- 
Penny Opera "Jenny." In the service of his "family," he has 
been their nasty, biting dog, who exhibits a sadistic delight in 
doing harm, but who dutifully delivers the message which 
that "family" places in his mouth. 

A Plutarch might, like Webster Tarpley, regard George 
as a modern Caligula. 13 An historian of organized crime, 
might find a likeness to "Bugsy" Siegel's Murder, Incorpo- 
rated hireling, Abe "Kid Twist" Reles. 14 A more appropriate 
note of caution, to those who would assess the four cases 
referenced, or similar ones: One must not overlook the fact, 
that even the deadliest poisonous snakes, or pandemic dis- 
eases, are not distinguished by the intellectual achievements 
of their species. 

The practical issue 

Throughout history, the noblest political passion has been 
the desire to establish a form of government consistent with 
the needs of the individual person as a creature "made in the 
image of God." Until the first qualified success, during Louis 
XI's A.D. 1461-1483 reign in France, no nation-states ex- 
isted; until then, more than ninety-five percent of the popula- 
tions of all branches of culture, lived as slaves, serfs, or worse. 
It was in the wake of the 1439-1441 Council of Florence, that 
France could emerge as the first nation-state, the first state in 
which Europeans were citizens of the state, rather than chat- 
tels of an imperial order modelled upon the wicked traditions 
Babylon, Rome, and Byzantium. 15 

It was the intent of a great struggle by the founders of 
this Federal constitutional republic, that this nation might be 
perfectly sovereign, subject to no authority external to the 
moral law reflected in the Preamble of our Federal Constitu- 
tion. Subject to the constraints of that moral law, it is the 
interest of the citizenry, as that Preamble expresses this, both 
explicitly and implicitly, which is the only interest to which 
our government may submit itself. 

What is the point? What is the connection to the Bush 

13. ibid. 

1 4. Despite New York prosecutor Tom Dewey ' s actions to Lansky ' s advan- 
tage (the "Lepke" Buchalter conviction), the truth aboutMeyer Lansky 's and 
"Bugsy" Siegel's direction of Murder, Incorporated, came to light as a by- 
product of a police raid on Siegel's California premises. The evidence col- 
lected pointed to Siegel's and Lansky's close connections to "Kid Cann" in 
Minnesota, and to crucial, relevant elements of "Kid Twist's" background. 

15. A scholar who might wish to challenge the argument which this writer 
has developed in sundry published locations, would wish to compare that 
thesis with the work of one of the 20th Century's most distinguished legal 
scholars: Professor Friedrich (Freiherr) von der Heydte, Die Geburtsstunde 
des souveraenen Staates (Regensburg, Germany: Druck und Verlag Josef 
Habbel, 1952). The same type of evidence referenced by von der Heydte 
appears within China' s ancient imperial form of state and property-relations. 

case? The point of connection is this. 

Under such rubrics as "What is good for Wall Street, is 
good for the United States," or, worse, George Bush's flimsy 
pretext, both as Vice-President and President, "We must do 
nothing to violate our 'special relationship' with Britain," we 
have tolerated the emergence of "secret governments." These 
"secret governments," notably that administered by Vice- 
President Bush, have conducted the hidden foreign and do- 
mestic policies of that special interest, behind the back, and 
without the explicit knowledge or consent of the constitu- 
tional institutions of our rightful government. These secret 
government arrangements include such instances as that 
channel of the Joint Chiefs of Staff through which Vice-Presi- 
dent George Bush facilitated the secret and unlawful subter- 
fuges of his Contra operations, his international weapons- 
trafficking operations, his drug-running into the United 
States itself. 

These covert operations are not operated by "some peo- 
ple"; they are run according to what a powerful financier 
oligarchy perceives to be its very special, self-interested pol- 
icy. Like monarchs and oligarchies of old and foreign places, 
this financier-dominated circle which deploys Bush, confuses 
the name of the U.S . interest with its own interest, and delimits 
its perception of "patriotism" to that which is dutiful to the 
perceived self-interest of the ruling oligarchy. 

We, the citizens, must regain control of our constitutional 
institutions of Federal government. We do not want an anar- 
chic democracy, under the irrational caprices of a transient 
majority opinion; we, like Socrates' Athens, are already suf- 
fering far too much of government subverted, in the perverted 
name of "democracy," by the transient whims of men. We 
require government under law, as the Preamble of our Federal 
Constitution commands government implicitly, to protect the 
rights of the minority opinion against the overreaching arro- 
gance of the passing whims of an accidental majority. 

We must not destroy our Federal government, as lunatic 
libertarians and similar anarchists propose. We must take 
back our Federal government, by acting in exemplary fashion 
now, to bring back a government under constitutional law. 
We shall never accomplish that, until we bring to the bar of 
justice: George Bush, his cronies, and his "secret govern- 
ment" established under Executive Order 12333. Unless we 
act so, to defend our Constitution, none of us alive today shall 
ever again enjoy theaneans to defend ourselves against the 
homicidal tyranny of those who follow in the footsteps of 
Vice-President and President George Herbert Walker Bush. 

Lyndon H. LaRouche, Jr. 
Leesburg, Virginia 
October 15, 1996 

viii October 1996 

EIR Special Report 

Chapter 1 

New revelations tie Palme murder to 
Bush, Thatcher-linked arms cartel 

On Feb. 28, 1986, Sweden's Prime Minister Olof Palme was 
assassinated on the streets of Stockholm, as he and his wife 
were walking home from a movie. Palme' s wife was also shot 
in the attack, but survived. The assassin, or assassins, escaped, 
despite the fact that the prime minister's security detail was 
in the area, when the attack took place. 

More than ten years have passed since the Palme murder, 
and, up until September 1996, Swedish authorities had failed 
to catch the assassins, or even name the responsible agencies. 
From the very outset, an ambitious international disinforma- 
tion campaign was carried out, involving such "strange bed- 
fellows" as the Soviet KGB, the East German State Security 
Service ("Stasi"), the An ti -Defamation League of B'nai 
B 'rith (ADL), and NBC-TV, to deter honest Swedish investi- 
gators from pursuing promising trails of evidence. Instead, 
the ADL, the Stasi, et al., colluded to fabricate "proof that the 
assassin was associated with Swedish colleagues of American 
political economist, three-time Democratic Party pre-Presi- 
dential candidate, and E1R Founding Editor Lyndon H. 
LaRouche, Jr. By the time the bogus "LaRouche killed 
Palme" tale was discredited, the trail of the real assassins had 
turned colder than a Swedish winter. 

The Palme assassination was not an isolated incident. As 
you will learn below, since 1984, a large number of public 
figures, including French general Rene Audran, German state 

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government-backed "freedom fighters," generated much of 
the money used to purchase weapons and other materiel. In 
Africa, a lucrative trade in black market ivory, diamonds, and 
rhinoceros tusks served the same function as the illegal drug 
""trade in Central America and Afghanistan. It generated mil- 
lions of dollars in illegal funds to finance the purchase of weap- 
ons — to keep the regional conflicts going. 

The 'asteroids' 

To protect the interests, and carry out the clandestine ac- 
tivities of this transnational apparatus, a global network of 
hired killers and soldiers of fortune was assembled, under a 
variety of private, commercial covers. This latter-day "Mur- 
der, Inc." represented both a direct continuity from, and an 
expansion of, the 1960s and 1970s British intelligence front- 
company Permindex, that was implicated in the assassination 
of President John F. Kennedy, in the murder of Italian oil 
industry figure Enrico Mattei, and that tried, unsuccessfully, 
to assassinate French President Charles de Gaulle. That 
1960s-era worldwide "Murder, Inc." was based, at various 
points, in Montreal, Rome, and Johannesburg. 

The vast 1980s "private enterprise," like its Permindex 
antecedent, was sponsored, protected, and deployed by ele- 
ments of the U.S., British, and French governments, among 
others. U.S. Vice President George Bush, the director of all 

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Swedish Prime Minister Olof Palme, at the Foreign Policy 
Association in New York City, Dec. 4, 1984. Solving the Palme 
assassination will unravel the global crime syndicate that spread 
drugs and illegal weapons all over the globe during the Bush- 
Thatcher era. 

Further, since the end of the Cold War and the collapse of 
the Soviet Union, a large, and growing number, of former 
Soviet intelligence operators have been integrated into this 
asteroid apparatus. It is impossible to understand the apparent 
"overnight" emergence of a powerful, worldwide "Russian 
Mafia," over the past five years, without factoring in the role 
of former KGB and GRU (Soviet Military Intelligence) per- 
sonnel within the asteroids; and without recognizing the ante- 
cedents of this new East- West criminal "partnership," in the 
Cold War era arms- and drug-trafficking collusion between 
the intelligence services of the two rival power blocs. This 
Cold War arrangement, among corrupted intelligence assets, 
East and West, might be termed the policy of "destructive en- 

The Palme case offers a critical window into this global 
asteroid phenomenon, and underscores the role of the 
Thatcher and Bush circles, in creating the policy framework 
for the proliferation of these modern-day pirates and dra- 

New Palme murder revelations 

Dramatic new evidence about who killed Olof Palme, and 
why, has surfaced since late September 1996. It began in 

a South African courtroom, where a former South African 
security officer was on trial for a series of apartheid-era assas- 
sinations. Col. Eugene de Kock, who headed a covert "death 
squad" unit of the South African paramilitary police, called 
C-10, had already been convicted, following a 19-month trial, 
of the murders of four anti-apartheid activists. He was origi- 
nally indicted on 89 counts of murder, conspiracy, and fraud. 
During his sentencing hearing, on Sept. 26, 1996, de Kock 
calmly revealed to the court that a well-known South African 
spy-turned-National Party politician, Craig Williamson, had 
been responsible for the assassination of Olof Palme. 

Several days later, another former head of the same C-10 
unit, Brig. Johan "Dirk" Coutzee, who had been Williamson' s 
boss inside the South African paramilitary police for years, 
issued a public statement, corroborating de Kock's charges 
against Williamson. In addition, he named another former 
South African intelligence operator, James Anthony "Ant" 
White, a former Rhodesian Selous Scout, as the actual killer 
of Palme. 

Next, a third associate of Coutzee and Williamson, Peter 
Casselton, came forward with additional details about the 
Palme hit. He identified "one individual living in Turkey" as 
another important player in the murder. The man was soon 
identified as Bertil Wedin, a Swedish national and one-time 
United Nations soldier, widely known in extreme right-wing 
circles in Scandinavia. Wedin is living in the Turkish sector 
of Cyprus. He had lived for several years in London, where 
he was on the payroll of South African intelligence. Wedin 
had also functioned as an informant for SAPO, the Swedish 
national police agency, which was in charge of the Palme 
assassination probe. 

In recent years , Wedin has been as sociated with a S wedi sh 
magazine, Contra, which has been a channel of contact among 
"asteroid" networks in North America and Europe. Contra, 
for example, has featured writings of Dr. Jack Wheeler, a 
leading player in the 1980s "Reagan Doctrine" of surrogate 
warfare throughout the Third World. Wheeler today is part of 
a London-based and British Intelligence-linked outfit, Strate- 
gic Investment, that has been involved in the British propa- 
ganda campaign against the U.S. Presidency, ever since Bill 
Clinton replaced George Bush in the White House in Janu- 
ary 1993. 

Mounting evidence 

Despite the fact that Williamson, White, and Wedin have 
all publicly denied that they were involved in the Palme mur- 
der, in the weeks since the initial de Kock courtroom revela- 
tions, a great deal of evidence implicating the three men in 
the crime, has come to light. Williamson has been arrested 
by Angolan authorities, and remains behind bars, as of this 
writing; and Swedish prosecutors have been dispatched to 
Johannesburg, South Africa, to pursue all of the leads that 
have bubbled to the surface since Sept. 26, 1996. 

Within days of the de Kock statements and the other new 

2 October 1996 

EIR Special Report 

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These are some of the news stories that have appeared in the European and American press, since Eugene de Kock's startling Sept. 26, 
1996 testimony, naming Craig Williamson as the architect of the assassination of Sweden' s Prime Minister Olof Palme. 

revelations, stories began to appear in the Swedish press that, 
while giving credence to the "South African connection" to 
the murder of Palme, sought to explain the involvement of 
Williamson, White, et al. strictly from the standpoint of 

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A global apparatus 

Williamson and White were not merely hit-men for the 
apartheid regime in South Africa. By the mid-1980s, when 
the Palme assassination plot unfolded, both men were in the 

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dor) — all at an enormous profit to the Club of the Isles. 

Even a cursory review of the public files on Williamson 
and White establishes their links to this London-Washington 
apparatus, which also was engaged in a sophisticated, 
Hobbesian alliance with certain factions within the Soviet 
bloc regimes and secret police agencies. 

Craig Williamson 

According to published accounts, including an interview 
with Williamson in the April 19, 1995 London Observer, 
Craig Williamson was recruited in the early 1970s, while a 
university student, as a spy for the South African security 
police, and was assigned to infiltrate radical student organiza- 
tions, especially groups involved in the anti-apartheid strug- 
gle. By the late 1970s, Williamson had maneuvered himself 
into a leadership position in the International University Ex- 
change Fund headquartered in Geneva, a group that special- 
ized in conduiting money to the African National Congress 
(ANC). Among the other directors of the IUEF, while Wil- 
liamson was infiltrating the fund, were Swedes Bernt Carlsson 
and Gunnar Eriksson, both close collaborators of Swedish 
Social Democratic Party leader, and frequent prime minister, 
Olof Palme. 

In January 1980, Williamson returned to South Africa, 
along with his security branch boss, Brig. Johan Coutzee. 
Coutzee would eventually become the national police chief 
of South Africa. In 1989, he defected to the ANC, and began 
to spill the beans on some of the most egregious apartheid- 
era crimes of the National Party. Because of his early break 
with the National Party, Coutzee is considered to be a very 
credible source of eyewitness information about the dirty war 
in southern Africa. 

Williamson remained in the security branch as an officer 
until 1985, when he retired with the rank of major. He immedi- 
ately joined the South African military intelligence service, 
and was promoted to the rank of colonel. 

While he was still with the security branch, Williamson, 
by his own admission, participated in a series of terrorist 
attacks and assassinations, targetted against leading figures in 
the ANC. Among the crimes to which Williamson confessed 
were the 1982 assassination of anti-apartheid activist Ruth 
First, in Maputo, Mozambique; the bombing of the London 
headquarters of the ANC the same year; and the Lubango, 
Angola mail-bomb killings of Jeanette Schoon and her six- 
year-old daughter, Katryn, in 1984. The actual target of the 
1984 mail-bomb attack was Marius Schoon, another promi- 
nent anti-apartheid activist. 

When Williamson switched over to South African mili- 
tary intelligence in 1985, he operated under the cover of sev- 
eral "private" companies, including GMR, an international 
trading company, founded by Giovanni Mario Ricci (a shad- 
owy figure with whom we will deal later) and an outfit called 
Longreach. According to South African government sources, 
Longreach shared offices in Johannesburg with GMR, but 

also maintained offices on the Isle of Wight, off the coast of 
England. These sources report that the British government 
reached a modus vivendi with Longreach, which was known 
to be a front for South African intelligence. It was all right for 

Key to Map 1 

During the Bush-Thatcher era, which began in 1979 with 
the election of Margaret Thatcher as British prime minis- 
ter, and continued through 1 993, when George Bush left 
office as President of the United States, there was a 
succession of regional wars and conflicts, all reflecting 
British geopolitical machinations, aimed at spreading an 
"arc of crisis" across the southern tier of Eurasia and 
Africa, and stretching into the Western Hemisphere. 
Each of these conflicts was fueled by the international 
arms and munitions cartels, with their global apparatus 
of arms smugglers, black marketeers, money launder- 
ers, drug-runners, and mercenaries. The most promi- 
nent of these "zones of conflict" include: 

1. Central America: The George Bush-led Nicara- 
guan Contra program (1 981-88), and the parallel conflict 
in El Salvador, engulfed all of Central America in the 
war. Honduras, Costa Rica, Guatemala, Panama, and 
El Salvador all served as staging areas, resupply depots, 
and training grounds for the Contras; as a byproduct of 
the war, the region became a major narcotics hub, with 
some of the Contra resupply bases simultaneously serv- 
ing as refueling stops and transshipment points for the 
Colombian drug cartels, which flooded the United States 
with cocaine during the 1980s. 

2. Panama: In December 1989, George Bush or- 
dered a full-scale military invasion of Panama, ostensi- 
bly to arrest Gen. Manuel Noriega on narcotics trafficking 
charges, in which thousands of Panamanians were 
killed. As a result of the invasion, the Bush administration 
installed the Cali Cartel of Colombia, in power in Pan- 
ama, and the country became a major narcotics trans- 
shipment point and money-laundering center. 

3. Malvinas War: From April to June 1982, the Brit- 
ish government carried out a colonial war of aggression 
against Argentina, to retake control of the Malvinas Is- 
lands in the South Atlantic. With backing from the Bush 
apparatus in Washington, the British used the Malvinas 
conflict: a) tosilence all opposition to International Mone- 
tary Fund policies, b) as a precedent for subsequent 
NATO "out-of-area" deployments, and c) to begin the 
institutional down-sizing and dismantling of armed 
forces across the continent, in order to establish supra- 
national military control. 

4. Angola: Beginning in the late 1 970s, Angola was 

4 October 1996 

EIR Special Report 


Longreach operatives to stalk ANC leaders inside Britain — 
as they did for years; but, it was not acceptable for Longreach 
to officially operate "on shore," with an office in London. As 
we shall see, Williamson's ties to British intelligence, and 

to senior figures in the City of London financial oligarchy, 
deepened over time. 

During 1985-87, according to De Wet Potgieter, the Pre- 
toria bureau chief for the South African Sunday Times who 

MAP 1 


Thatcher 'zones of conflict' 

engulfed in a surrogate war between the Soviet Union, 
China, and the West. The war lasted into the early 1 990s. 
South Africa was one of the important weapons trans- 
shipment points, and guerrilla training centers, for the 

viet Red Army invasion and takeover in Kabul, the Brit- 
ish, American, and Israeli governments, with backing 
from Saudi Arabia and other Persian Gulf states, re- 
cruited, trained, and armed an Afghansi mujahideen 

has written a book cataloguing the South African underworld, 
Longreach employed Anthony White as a director. Official 
statements by GMR claim that the firm's South African 
branch was not formally started until sometime in 1 986, but 
other published accounts, backed by sources in South Africa, 
place the actual start-up date, and the point at which William- 
son, White, and Ricci were in collusion, at some time during 
1985, at the latest. So, according to these sources, during the 
24-month period preceding and following the Palme assassi- 
nation, White, Williamson, and Ricci were all involved, to- 
gether, in Longreach. 

Longreach' s executive director at this time was Michael 
Irwin, a "former" high-ranking officer in the British Royal 
Marines. According to the Swedish daily Aftonbladet, Irwin 
functioned as a liaison between British and South African 
intelligence, via Longreach, to coordinate such activities as 
the surveillance of anti-apartheid activists, and the breaking 

of the United Nations embargo against South Africa, through 
an elaborate smuggling apparatus. The Aftonbladet informa- 
tion is consistent with a report from a South African govern- 
ment official, that Longreach was simultaneously operating 
out of the Isle of Wight. 

It is here that the role of Giovanni Mario Ricci takes on 
special significance, and reveals links among Williamson, 
White, and a European-based criminal infrastructure that fig- 
ured prominently in some of the most notorious of the Bush- 
Thatcher "secret parallel government" activities of the 1980s. 

Ricci, an Italian national, with close ties to the Propaganda 
Two (P-2) Italian freemasonic lodge, set up shop on the Sey- 
chelles Islands during the mid-1970s. When the island's were 
taken over by a "Marxist" regime, under President-for-life Al- 
bert Rene, Ricci became the power behind the throne, and rap- 
idly helped transform the Seychelles into a world-class off- 
shore money- laundering center and tax haven. Ricci' s own 

Williamson's 'confession' 

On April 19, 1995, Craig Williamson, in an interview with 
the London Observer, detailed his role, and that of a special 
unit of the South African paramilitary police, in a number 
of terrorist attacks against the African National Congress 
(ANC), during the 1980s. Williamson's "confesssion" 
came one day before the start of the trial of Eugene de 
Kock, his boss, and collaborator in at least one of the terror- 
ist atrocities. Williamson had already testified, in late 
1994, before the South African Truth Commission, an of- 
ficial body established by President Nelson Mandela to 
probe the crimes of the apartheid era, in the hopes of being 
granted amnesty for his role in these terrorist acts. Accord- 
ing to the news story, by Phillip Van Niekerk, the Observer 
learned of Williamson's testimony before the Truth Com- 
mission and, on that basis, obtained the interview. 

In the interview, Williamson named six other South 
African Special Branch officers who participated with 
him, in the March 1982 bombing of the ANC headquarters 
in London. The bomb, Williamson stated, was assembled 
atthe South African embassy in London, from components 
that had been smuggled into the country. According to the 
Observer, "Williamson was second-in-command of the 
London bombing operation. His commander was Col. Piet 
Goosen, who had achieved his own notoriety as the man 
in charge of the interrogation of the black activist Steve 
Biko when he was beaten to death in detention in 1977. 
Also on the team was Eugene de Kock, whose trial on 126 
charges of murder, fraud, and arms smuggling — prompted 
by the Goldstone report into the causes behind the violence 

in black communities — is to start in Pretoria tomorrow. 
. . . Williamson also publicly disclosed for the first time 
his role in two other infamous bombings of the apartheid 
era: the murders of the academic Ruth First and of ANC 
member Jeanette Schoon and her six-year-old daughter 
Katryn, who were blown up by parcel bombs assembled 
by Williamson's unit at police headquarters in Pretoria. 
. . . Some security sources are skeptical of the claim that 
such a large team was needed for the [London] operation, 
but Williamson says the operation was of such a sensitive 
nature that it required a full-scale team. Williamson said 
that a British national called Peter Casselton, previously 
alleged by renegade police death squad captain Dirk Cout- 
zee to have committed the sabotage on his own, was only 
a leg-man in the operation." 

While there is little reason to doubt the accuracy of 
Williamson's account of the London bombing, and the 
First and Schoonparcel bombs, his account to the Observer 
was quite self-serving. He claimed that, following the 
deaths of Schoon and her daughter, he became "disillu- 
sioned with police work." "I came to the conclusion that 
the war was lost because the strategy that was being used 
was wrong. It was getting more and more military and less 
and less political, and it had to go the other way. So I 
decided to get involved in proper intelligence work, espe- 
cially on the international scene," he said. Of course, that 
would lead Williamson into collusion with an international 
arms-trafficking and crime cartel. And, according to the 
recent allegations of de Kock and Coutzee, it also led Wil- 
liamson to play a pivotal role, on behalf of those interna- 
tional cartel interests and their backers in London and 
Washington, in the assassination of Sweden's Prime Min- 
ister Olof Palme. 

6 October 1996 

EIR Special Report 

Seychelles International Bank became the islands' de facto 
central bank; Ricci, in 1983, arranged for abranch of the Bank 
of Credit and Commerce International (BCCI) to be opened on 
Mahe Island; Ricci was made the unofficial chief of the is- 
lands' foreign intelligence service; and Ricci' s hotel became a 
safehouse-of-preference for some of Europe's leading finan- 
cial swindlers and renegade arms merchants, many of whom 
were involvedin aspects of the Thatcher-Bush secret wars. 

Mario Ricci, P-2, and the Knights of Malta 

Africa Confidential, a London newsletter often described 
as being closely affiliated with Britain's MI-5, published a 
story on the Ricci- Williamson alliance in its April 15, 1987 
issue, entitled "South Africa: The Network of a Master Spy." 
Africa Confidential editor Stephen Ellis reported that the 
Ricci-Williamson collaboration was principally aimed at 
breaking the South Africa embargo, especially the petro- 
leum embargo. 

"Oil exports to South Africa are outlawed by the United 
Nations," Ellis noted, "although South Africa has previously 
experienced little difficulty in circumventing this legislation, 
largely through independent commodity dealers such as Marc 
Rich. Rich in fact visited the Seychelles in 1984 for talks with 
local officials and others to discuss a scheme to establish the 
islands as an oil-dealing entrepot, buying cheap from Mexico 
and re-selling the oil for a profit. Rich is not known to have 
participated in this plan subsequently. This scheme was the 
brainchild of Francesco Pazienza, a former employee of the 
Italian military intelligence service SISMI, and a former con- 
sultant to the notorious Banco Ambrosiano. Pazienza, an ex- 
traordinary political fixer, is currently on trial in Italy for 
offences connected with the 1982 collapse of Banco Ambro- 
siano. Pazienza stayed at Ricci's hotel in the Seychelles when 
he was on the run from the Italian police in 1984. It was then 
that he raised the oil scheme which he discussed with other 
interested parties, including Rene, Ricci, Rich, and Robert 
Armao, former aide to the Rockefeller family, spokesman for 
the late Shah Mohammed Reza Pahlevi of Iran, and friend 

nized as the ambassador of Pazienza's outfit. Ricci's spurious 
diplomatic status gives him access to a diplomatic bag. Wil- 
liamson has also joined Ricci's Order of St. John. . . . The 
Seychelles is the only country in the world which has given 
diplomatic recognition to Ricci's order. ... He has rendered 
numerous services to the Seychellois government over a pe- 
riod of years, including supervision of external security and 
donations to the ruling party. And it was Ricci who, according 
to President Rene, masterminded the establishment of the 
Seychelles as a tax haven, a strange development in a Marx- 
ist state. 

"Williamson's directorship of GMR (South Africa) gives 
him an association with a remarkable international network 
in Europe, the Indian Ocean, Somalia and Kenya, where GMR 
is said to have interests in casinos. An impressive array." 

Impressive, indeed. The Knights of Malta, both the offi- 
cial Vatican-recognized order, and the many splinter orders, 
have been long identified as pivotal to the global arms trade. 
Sam Cummings, the American-born, London-based arma- 
ments dealer who founded Interarms, the world' s largest "pri- 
vate sector" supplier of weapons, is a longtime member of the 
Knights of Malta, as was the late CIA director Casey, and 
American shipping magnate J. Peter Grace. Cummings and 
Grace were instrumental in the "public diplomacy" efforts, 
on behalf of the Bush-North secret wars of the 1980s. 

But, Ricci's connections to the even more shadowy P-2 
Lodge are of equal significance to the reinvigorated Palme 
probe, with its focus upon the "South Africa connection," 
Williamson, White, et al. 

Propaganda Two 

When the Italian B anco Ambrosiano went bust in the early 
1980s, and the bank's president, Roberto Calvi, was discov- 
ered hanging from Blackfriars Bridge in London, the apparent 
victim of a Freemasonic ritualistic murder, an international 
scandal erupted, exposing the role of the illegal Italian Free- 
masonic Lodge, P-2, in a wide range of criminal activities, 
including a rash of right-wing bombings and assassinations 

Bush administration in Washington. 

One of the most prominent of the Reagan-Bush adminis- 
tration national security figures publicly tied to Gelli and his 
P-2 Lodge, was Michael Ledeen, a consultant to the National 
Security Council, and a close associate of President Reagan' s 
first secretary of state, Alexander Haig (a former secretary 
general of NATO). Ledeen, although officially listed merely 
as a White House "consultant," was the liaison to Manucher 
Gorbanifar, the Israeli Mossad-linked Iranian "businessman" 
who brokered the original arms-for-hostage deals, through 
which the United States and Israel funnelled tons of weapons 
to the Ayatollah's regime, throughout the Iran-Iraq War. 

At his 1987 trial in Bologna, Italy, Francesco Pazienza 
confirmed Ledeen' s links to the P-2, and to the "Super SISMI" 
apparatus, run by SISMI chief and P-2 member Gen. Giu- 
seppe Santovito. 

"The Supersismi was not a structure, but a kind of organi- 
zation. I was called to collaborate with SISMI in January 
1980. 1 had met General Santovito in November-December 
1979 . . . and since the end of 1979, Santovito proposed to me 
to become SISMI station chief in Paris. ... I cannot name 
the names of my collaborators, but given that one name has 
already come out, I have no problem in saying that among 
them was Michael Ledeen, who was there even before I ar- 
rived, and continues to collaborate with the service — so much 
so that I came to know with absolute certainty that, in 1985, 
he was receiving all the investigative-judicial material con- 
cerning the investigation for the attempt against the pope." 

The final report of the magistrates assigned to investigate 
the crimes of the P-2 Lodge identified Pazienza as a Ledeen 
recruit, "essentially the representative of an intelligence struc- 
ture of the U.S. Republican Party, that came to influence pro- 
foundly our counterespionage service." Through the Ledeen 
channel, both Pazienza and P-2 Grand Master Gelli were, 
in fact, invited to attend the Reagan-Bush inauguration in 
January 1981, in Washington, D.C. While in Washington, 
they held behind-closed-doors meetings at the Republican 
National Committee headquarters, with Philip Guarino. 

Ledeen had inserted himself into the Reagan administra- 
tion, courtesy of his P-2 friends. In October 1980, on the 
eve of the U.S. Presidential elections, Ledeen and Arnaud de 
Borchgrave had co-authored a series of front-page stories in 
the Washington Times, a newspaper owned by South Korean 
Rev. Sun Myung-Moon and his Unification Church. The sto- 
ries revealed that Billy Carter, the brother of President Jimmy 
Carter, had been involved in secret business deals with Italian 
"businessman" Michele Papa (later exposed as a P-2 mem- 
ber), and Libyan dictator Muammar Qadaffi. The scandal had 
little impact on election day, because Ronald Reagan was to 
defeat Carter easily. It did, however, boost the credibility of 
Ledeen and Haig, his close associate, helping to land both 
men important posts in the newly elected Reagan-Bush ad- 

Italian investigative magistrate Palermo, during his own 

investigations of P-2, found that, in addition to Billy Carter, 
Michele Papa' s Libya dealings had involved another P-2- 
linked financier, Giovanni Mario Ricci, of the Seychelles. 

The Ricci links to Qadaffi were further explored by Africa 
Confidential in the April 1987 issue that highlighted the Ricci- 
Pazienza- Williamson-Marc Rich embargo-busting collusion. 
"The Seychelles International Bank continues to fascinate, 
by reason of its association with various exotic financiers, 
including some involved in such interesting escapades as the 
collapse of the Italian Banco Ambrosiano, the Italian bank 
which went under in 1982, leaving a huge hole in its ac- 
counts," Stephen Ellis wrote. 

"Ricci' s interests certainly included the SIB, at least until 
recently, although it is not clear whether he still remains a 
director. Currently, lots of SIB shares are held by unidentified 
interests in Hong Kong, and Australia. But the largest single 

Ricci and Williamson 
on the GMR group 

To hear Giovanni Mario Ricci' s description, one would 
get the impression that GMR was an above-board, growing 
industrial and investment firm, expanding its operations 
throughout southern Africa. A January 1 987 company pro- 
spectus provided the following thumbnail history of 
GMR group: 

"Giovanni Mario Ricci, founder of the GMR group, is 
descended from a Tuscan family of merchants, financiers, 
and entrepreneurs. He follows in the footsteps of his fore- 
bears who traditionally have promoted international trade, 
fostered diplomatic ties, and have been active patrons of 
the arts. He was born on 7th August 1929 in the Garfag- 
nana, an exceptionally beautiful region of Tuscany, cele- 
brated by poets such as Heine and Pascoli. . . . 

"During the 1960s, Giovanni Mario and Giuseppe 
Ricci, the only survivors, found the strength to combatfate 
and to begin the reversal of [the family's] long retreat. 
They reconstructed the family's fortune by streamlining 
and concentrating in a single international organization 
the vast range of mercantile, entrepreneurial, and financial 
experience that the Riccis had accumulated through gener- 
ations of the widest ranging commercial activity. . . . To- 
day the history of the Ricci brothers is one of an interna- 
tional group which pursues financial profits in complete 
accord with the economic development of the countries in 
which it operates. This is done in the open; the group has 
no secrets and does not seek political power either covertly 
or overtly. 

8 October 1996 

EIR Special Report 

known holder of SIB shares is the Luxembourg-based com- 
pany Transmarine. 

"So in order to assert who owns the SIB, it is necessary 
to know who owns Transmarine. The controlling interest in 
Transmarine is in fact held by the powerful Italian entrepre- 
neur Giancarlo Parretti, who has excellent contact in French 
and Italian socialist circles. . . . But perhaps the most intri- 
guing Transmarine shareholder is Florio Fiorini, a financial 
technician of legendary skill. He resigned a former post as 
financial director of the Italian State Oil Company, ENI, in 
1982, after making unauthorized payments to the Banco Am- 
brosiano. Fiorini is also among the directors of the Societe 
Anonyme Suisse Pour les Exploitations Agricoles (SASEA), 
a company taken over in the 1970s by friends of the late 
Michele Sindona. The company is believed to have access to 
capital from Arab, and, especially, Libyan sources, as well as 

from Swiss, Italian, and Norwegian financiers, and possibly 
some well-known New York family. . . . Several SASEA di- 
rectors, including Fiorini and Manfredi Lefebvre d'Ovidio, 
have been directors of the SIB and may still hold director- 

"It is this connection with the SASEA which is the root 
of the SIB's current difficulty. In 1986, SASEA planned to 
buy a block of shares of the insurance company, Assicurazi- 
one Generale, from the Lebanese businessman — and con- 
victed fraudster — Antione Tannouri. SASEA paid Tannouri 
an advance of $4 million, drawn on the Seychelles Interna- 
tional Bank. SASEA subsequently claimed Tannouri had 
failed to hand over the shares. Tannouri has issued a counter- 
claim against SIB in Monte Carlo, through his French lawyer, 
Jacques Verges, famous as the advocate of the old Nazi 
Klaus Barbie." 

"Today the name GMR group characterizes an organi- 
zation managed by the most advanced techniques, dedi- 
cated to a profound and detailed study of our times. It is 
staffed by dynamic and highly experienced managers who, 
while being acutely aware of the problems of present-day 
society, look to the future in the firm belief that: 'The 
foundations of a free and peaceful human society will be 
constructed only from that which men make through work, 
not from that which they destroy by war.' 

"The GMR group is a private group led and managed 
by a family which has its origins in a past of intense activ- 
ity. All of its top officers are linked to the Ricci family by 
family ties, associations, and old friendships. . . . 

"Our principal activities are: acquisition of those in- 
dustrial and/or commercial companies which multina- 
tional corporations decide to dispose of in implementing 
their disinvestment policies in those countries where, due 
to the changed economic, political, or social circum- 

etanrpc their investments have hemmp wnnnmirnllv nr 

when all nations will be liberated from this interference, 
will mankind really be 'free to choose.' " 

Dealing with 'problems' 

In the prospectus, Craig Michael Williamson, who was 
listed as the managing director of the GMR group South 
Africa, added his statement about the firm's activities in 
the Republic of South Africa. He wrote, "I joined the GMR 
group in 1986 after leaving government service in South 
Africa. I established the GMR group (SA) (Pty) Limited 
and was appointed managing director in July 1986. 1 decid- 
ed to accept the offer of the chairman of GMR to join his 
group and to develop GMR activities in the Republic of 
South Africa and in other countries of the region because 
of the fact that I regard the GMR group ' s business philoso- 
phy as an example of what private capital should be doing 
throughout the world. 

"Political and economic problems, especially of Africa 

ar\r\ Smith Amerira miptp. u/hnt T Henlt ii/ith frtr 1 7 vpptq nc 

The telegram 

For years, official investigators of the Palme assassination 
had assiduously avoided looking into a mysterious telegram, 
uncovered by Italian investigators probing the P-2 scandal. 
The purported telegram, which has yet to be authenticated, 
was allegedly sent on Feb. 25, 1986 — three days before the 
Palme assassination — by P-2 Grand Master Licio Gelli, to 
Republican National Committee official, and P-2 member, 
Philip Guarino. The text of the purported telegram read: "The 
Swedish tree will be felled, tell our good friend Bush." The 
telegram was an obvious reference to the pending assassina- 
tion of Olof Palme. 

Published accounts of the purported Gelli-Guarino tele- 
gram have all been ultimately traced to Pazienza, and there 
remains a great deal of skepticism about the accuracy of his 
account, in part because of the seriousness of the implications, 
were the telegram to be authenticated. 

With the new "South Africa connection" revelations, and 
the links, via Ricci, to the Italian P-2 apparatus, the telegram 
may take on new significance. P-2 was certainly implicated 
in some of the most brazen acts of terrorism of the 1980s, 
beginning with the Aug. 2, 1980 bombing of the Bologna, 
Italy train station, in which 85 people were killed, and hun- 
dreds injured. Stefano della Chiaie, a P-2 figure personally 
implicated in the "Bologna massacre," would later surface in 
Bolivia, as a powerful behind-the-scenes figure during the 
"Cocaine Colonels" regime. 

The Ricci-Williamson South African complex, including 
GMR and Longreach, now being linked to the Palme assassi- 
nation, was a part of the Southern African connection of 
Ledeen, Gelli, P-2, et al. 

The Israeli connection 

The presence of Marc Rich at the 1984 meeting to plan 
out the sanctions-busting effort, adds a further dimension to 
the Ricci-Williamson-White concert. Marc Rich served, 
throughout the 1980s, as a liaison among Israeli, Iranian, So- 
viet, and American intelligence networks, engaged in vast 
arms-, oil-, and drug-trafficking operations in the Middle East, 
Africa, and South America. The story of this bizarre set of 
subterranean business dealings came to light following the 
Dec. 23, 1987 arrest of a Lithuanian-born Israeli citizen, 
Shabtai Kalmanowitch, by Israeli police, on charges that he 
was spying for the Soviet KGB. 

Kalmanowitch was an operative for Marc Rich, who had 
played a pivotal role in Israeli intelligence operations in Af- 
rica. Kalmanowitch had "escaped" to Israel from Lithuania 
in 1971, and rapidly established himself as a sharp political 
operative, working, first, for the Israeli Labor Party, in the 
office of Prime Minister Golda Meir and, later, as a political 
liaison officer in East Europe. In 1977, Kalmanowitch 
switched over to the Likud Party, at the point that Menachim 
Begin became prime minister. Kalmanowitch' s initial Likud 
sponsor was notorious North African Jewish gangster Samuel 

Flatto-Sharon, who bought his seat in the Israeli Knesset (par- 
liament) that same year, in order to avoid criminal prosecution 
in France for his smuggling activities in francophone Africa. 

In the 1980s, Kalmanowitch setup a string of frontcompa- 
nies, including B International, and LIAT, which came to 
dominate the economies and governments of the South Afri- 
can bantustan Bophuthatswana, and the West African state 
of Sierre Leone, following a Mossad-engineered coup d'etat 
there in 1985. Wherever Kalmanowitch set up shop, Marc 
Rich was immediately brought in as his super-partner. Rich, 
who launched his career as one of the world's biggest and 
dirtiest commodities traders, at Phillips Brothers, struck out 
on his own in 1973, setting up Marc Rich and Company as a 
strategic metals and petroleum trading house in Zug, Switzer- 
land. Soon, Rich had established a special relationship with 
Iran, that survived the overthrow of the Shah and the takeover 
by Ayatollah Khomeini. 

By the early 1980s, Rich was running his own oil-for- 
arms pipeline in and out of Iran; he was the leading spot 
market trader in Soviet oil, and precious metals; and was the 
leading oil supplier to the Republic of South Africa, end- 
running the United Nations boycott. According to Africa Con- 
fidential, during 1983-86, Rich delivered over 2.5 million 
tons of Iranian oil to South Africa. Among the commodities 
swapped for the Iranian oil were 1 55-millimeter howitzers 
and ground-to-air missiles, manufactured in the South Afri- 
can factories of Gerald Bull's Space Research Corp. 

During their initial efforts on the continent, Rich and Kal- 
manowitch' s African operations were well-protected by the 
Israeli Mossad's senior officer in charge of Africa, David 
Kimche. Kimche, during the middle of the 1980s, became the 
director general of the Israeli Foreign Ministry, and the liaison 
to the Reagan-Bush White House secret operations. Through 
this Kimche connection, Kalmanowitch was able to staff ev- 
ery office of his LIAT firm with "retired" Mossad and Israeli 
Defense Force officials. Kalmanowitch also used his status 
as a "diplomat" for the Sierre Leone government, to travel 
throughout the Soviet bloc, arranging joint business ventures 
in Africa. Sierre Leone, in the meantime, had become a favor- 
ite smuggling port for Iranian oil bound for South Africa, but 
"delivered" to Rich and Kalmanowitch-owned companies in 
the West African republic. 


In 1995, South African journalist De Wet Potgieter pub- 
lished Contraband, an expose of the illegal trade in African 
ivory and rhino horns. In the book, he provided important 
additional revelations about the activities of Craig William- 
son, Mario Ricci, Anthony White, and a coterie of others 
involved in the "South African connection," now at the center 
of the Palme murder probe. 

Potgieter documented an Africa- wide criminal infrastruc- 
ture, that slaughtered much of the continent's elephant and 
rhinoceros herds, in order to peddle ivory and rhino horns on 

10 October 1996 

EIR Special Report 


the global black market, especially in Asia. Among the lead- 
ing poachers in this multimillion-dollar-a-year trade, were the 
so-called Angolan "freedom fighters" of Dr. Jonas Savimbi's 
UNITA rebel group, who financed a good part of their war 
for control of Angola through the ivory and horn trade. 

Potgieter bluntly stated: "For more than a decade, South 
Africa' s controversial military involvement in the bush war 
in Angola and Namibia was a pivotal factor in the illegal 
trafficking of rhino horn and ivory. The draconian security 
laws imposed by the Nationalist government of P.W. Botha 
and his predecessor . . . served as a perfect cover for the inter- 
national smugglers to operate with virtually no threat of prose- 
cution. . . .This 'service' to South Africa had given the syndi- 
cates carte blanche to establish smuggling networks, using 
South Africa as the conduit. These common criminals had 
secured for themselves the most wonderful cover by portray- 
ing themselves as allies of the South African security forces 
against the evils of the Soviet Union's so-called 'total 
onslaught.'. . . Since the 1970s, South African and foreign 
investigative journalists have, from time to time, exposed 
military involvement in the convoys of trucks laden with ivory 
and rhino horn moving from Angola to Namibia." 

One such investigator, cited by Potgieter, was Craig van 
Note, an American who testified before the U.S. House of 
Representatives Merchant Marine and Fisheries Committee. 
He said: "Jonas Savimbi and his UNITA rebel forces in An- 
gola, largely supplied by South Africa, have ruthlessly liqui- 
dated perhaps 100,000 elephants to help finance the war. Most 
of the tusks have been carried out on South African air trans- 
ports or trucks, although some moved through Zaire and Bu- 
rundi. The sturdy South African four-wheel-drive trucks that 
carry war materiel and other supplies across the Caprivi Strip 
to Savimbi's forces in southern Angola return laden with 
ivory and valuable tropical hardwood." 

These accounts of an illegal guns-for-ivory trade bank- 
rolling the Angolan "freedom fighters," parallels the Nicara- 
guan and Afghanistan cases, in which the flights bringing in 

Nelson Mandela, visiting the White House, June 25, 1990. Since 
assuming the Presidency of South Africa, his Truth Commission 
has unearthed key leads that could solve the Palme assassination. 

called Flocon International, which worked with the Frelimo 
government in the capital of Maputo. But, White's real clout 
in Mozambique derived from the fact that, according to one 
well -placed British investigator, Flocon International ran the 
security for Tiny Rowland's business ventures in the Baira 

Tiny Rowland, the longtime head of Lonrho (London 
Rhodesia Company), was, during the 1980s, one of the most 

Just one week before their deaths, they had been in Zaire, 
delivering a planeload of arms and supplies to UNITA. 

Rowland's involvement with the Bush-North Contra and 
Iran arms-for-hostages efforts, did not stop him from building 
strong ties to prominent Warsaw Pact circles. In January 1986, 
just one month before the assassination of Palme, Rowland, 
several other top Lonrho executives, and senior officials of the 
ruling British Tory Party had met in London with a business 
representative of East German intelligence's leading smug- 
gler, Alexander Schalck-Golodkowski, the head of the Stasi's 
"commercial" front, IMES. One of Rowland's top executives 
at Lonrho, Dr. Ashraf Marwan, an Egyptian married to the 
daughter of the late President Gamel Nasser, was on intimate 
terms with Libya's Muammar Qaddafi. The purpose of the 
January 1986 London meeting was to deepen collusion be- 
tween British and East German "commercial" organizations 
all across southern Africa. 

Operation Lock 

Another significant covert program, in which Williamson 
and Ricci played a prominent role, was Operation Lock. Here, 
the efforts of the GMR-Longreach crew most visibly tie into 
the highest echelons of the Club of the Isles, and the British 
and Dutch royal households. Operation Lock was the brain- 
child of Prince Bernhard of the Netherlands, the wartime Nazi 
who became the royal consort. He, along with his British 
counterpart, Prince Philip, helped launch the World Wildlife 
Fund (WWF) in the 1960s. Philip and Bernhard also created 
the secretive 1001 Club, which recruited 1 ,001 of the world' s 
wealthiest and most powerful individuals to bankroll the 
global environmentalist movement, beginning also in the 
1960s. Among the charter members of the 1001 Club was 
Maj . Louis Mortimer Bloomfield, a Canadian and the head of 
the 1960s-era "Murder, Inc." front, Permindex. 

According to Potgieter, Africa Confidential, and Irish in- 
vestigative journalist Kevin Dowling, in 1989, Prince Bern- 
hard dispatched a team of crack "former" British SAS com- 
mandos, headed by Col. Ian Crooke, to South Africa, 
ostensibly to eliminate some of the leading rhino tusk and 
ivory poaching syndicates, by "executive action." Operation 
Lock, as the WWF covert paramilitary operation was dubbed, 
was run through a London private security firm, KAS , initially 
established by Sir David Stirling, the legendary founder of 
British Special Air Services (SAS). Stirling created KAS at 
the behest of Prince Bernhard, and the Dutch monarchy put 
up an estimated 250,000 pounds sterling in "seed money" to 
launch Operation Lock. Ultimately, Operation Lock dis- 
patched over 25 "former" SAS commandos to South Africa, 
to run the private program. 

On the ground, Colonel Crooke solicited the aid of Craig 
Williamson, to assemble a team of "locals" to aid in Operation 
Lock. Williamson, in turn, set up several private security 
fronts, to funnel manpower into the Operation Lock effort. 
One such company, Control Risk Group (CRG), was headed 

by Ron Reid-Daly and Tim Lewis. Reid-Daly was the founder 
and commander of the Rhodesian Selous Scouts, the elite 
commando unit that had waged a brutal terror-war to try to 
salvage the Ian Smith regime in Rhodesia. Lewis was a "for- 
mer" British MI-6 officer. Lewis had been first sent to Africa 
by British intelligence in the early 1960s, and he had served 
with Reid-Daly in the Selous Scouts, serving at one point, as 
the immediate commanding officer of Anthony White. In the 
1980s, following the fall of Ian Smith, Reid-Daly had brought 
a team of Selous Scouts into Transkei, one of the first of the 
Republic of South Africa bantustans, and had tried, unsuc- 
cessfully, to lead a secessionist revolt there. 

Another outfit, employed by Williamson, to funnel man- 
power to Crooke and Operation Lock, was Executive Out- 
comes, headed by Eeben Barlow, a former South African 
military officer who had been active in Angola, providing 
support to Savimbi's UNITA, but who later contracted his 
"private" security services to the Angolan government. Bar- 
low later was appointed head of Western European operations 
for the Civil Co-Operation Bureau, one of the paramilitary 
police units deployed to eliminate anti-apartheid activists. 
Executive Outcomes, one of the largest private paramilitary 
operations in the world, hires out battalion-strength private 
military teams to multinational corporations and govern- 
ments. According to the Oct. 6, 1996 London Observer, Bar- 
low's firm has already dispatched battalions of mercenary 
troops to Sierra Leone, Sri Lanka, Malaysia, and to several 
countries in South America. 

The private firm that was most tightly controlled by Wil- 
liamson, and which played a prominent role in Operation 
Lock, was Tactical Risk Control, or R & TG. R & TG was 
established in July 1987, ostensibly by Michael Richards, 
Leon Falck, and a third man named Tyrrel-Glynne, but was 
always actually controlled by Williamson. 

While Operation Lock was ostensibly aimed at eradicat- 
ing the poaching syndicates, by infiltrating them, and system- 
atically eliminating their leaders, by extralegal means, it sub- 
sequently came to light that Colonel Crooke and his SAS 
teams — in league with Williamson and his crew, who trained 
the notorious Koevoet ("crowbar") unit, a pseudo-gang of 
former ANC soldiers— were actually responsible for manipu- 
lating the "Third Force" black-on-black violence that nearly 
triggered a civil war in South Africa, between the ANC and 
the Inkatha Freedom Party, during the run-up to the April 27, 
1994, first-ever general elections in the Republic of South 

Far from combatting the poaching syndicates, the Opera- 
tion Lock SAS teams had actually moved in and taken over 
some of the black market in ivory and rhino tusks. This ex- 
plains why the Operation Lock teams ostensibly "targetted" 
Anthony White, a well-known figure in the ivory smuggling 
business in Mozambique, while, at the same time, working 
intimately with White's partner, Craig Williamson. The 
whole effort was, in fact, a London, Club of the Isles-directed 

12 October 1996 

EIR Special Report 





destabilization of all of southern Africa, with the World Wild- 
life Fund of Prince Philip and Prince Bernhard leading the 

Following the death of Sir David Stirling in 1990, the 
control of KAS, and Operation Lock, was passed into the 
hands of Sir James Goldsmith, another leading Club of the 
Isles figure with major business holdings in Britain, the 
United States, and France. Goldsmith is a close personal 
friend of former U.S. President George Bush and former Brit- 
ish Prime Minister Margaret Thatcher. During the Reagan- 
Bush-Thatcher era, Goldsmith was deeply involved in "secret 
parallel government" operations all around the globe. 

Thus, the recently exposed "South Africa connection" to 
the assassination of Prime Minister Olof Palme, through 
Craig Williamson, Anthony White, Mario Ricci, and others, 
is, in reality, a component of the international, privatized in- 
telligence apparatus, the asteroids, associated with the Bush- 
Thatcher secret wars, and with the London-based Club of 
the Isles. 


International coverage of 
the 'South Africa connection' 

These are some of the major stories that appeared in the 
international press, in the first two weeks following the expo- 
sure of the South African links to the assassination of Prime 
Minister Olof Palme, in September 1996. 

International Herald Tribune, Sept, 28: In an article 
entitled "South Africa Angle," the paper reports on Sept. 26, 
1996, testimony by former South African counterinsurgency 

lends a different type of credibility to his story." 

Reuters, Sept. 28: "Apartheid HitMan Says Palme Killer 
in Mozambique," by Simon Haydon, reports that Dirk Cout- 
zee, predecessor to Eugene de Kock, as head of a South Afri- 
can government hit-squad, told Swedish TV that South Afri- 
cans were involved in the Palme killing, and that the murderer 
is today living in Mozambique. "There is no doubt that South 
Africa was behind the murder of Olof Palme, no doubt at all," 
Coutzee told Swedish TV. The article reports that Swedish 
"police knew Williamson had been in Sweden at the time of 
Palme's death but that he had not been anywhere near the 
central Stockholm street where the prime minister was shot 
dead late at night while walking home with his wife." 

Aftonbladet, Sept. 28: This Swedish daily provides a 
detailed background sketch of Bertil Wedin, one of the Swed- 
ish associates of Craig Williamson. After serving as an officer 
in Swedish United Nations military units in the Congo and 
Cyprus, Wedin tried, unsuccessfully, to join the U.S. Central 
Intelligence Agency in Vietnam in 1 966. Instead, Wedin went 
to work for the Swedish police agency, SAPO, as an infor- 
mant, and also went to work for a Wallenberg family bank. 

Aftonbladet writes, "Wedin became an informant for 
SAPO, and soon he was handing over information to them on 
the leftists. His contact in SAPO was Jan Zelmerloov, now 
the chief of SAPO in the town of Malmo. Wedin also worked 
at Enskilda bank in Stockholm. He produced a newsletter for 
them, called Mediasammandrag [Mediabrief]. Wedin wrote 
comments on political events in this newsletter, and he sent it 
out regularly to 1 ,250 business, military, and political leaders. 
According to the bank, this letter was read by Marcus Wal- 
lenberg, who prioritized it and read it every day." 

Reuters, Sept. 29: "Charges Fly Between ex-S. Africa 
Apartheid Agents," by Anton Ferreira, reports that another 
South African apartheid-era "police hit-squad head," Dirk 
Coutzee, "stirred the pot further on Saturday when he said 
Palme was killed by a former special forces soldier in the then 
white-run Rhodesian [now Zimbabwe] Army was a member 
of Longreach." While denying that he had a role in the Palme 

Wedin, is described as the most important of Williamson's 
Swedish associates. Wedin is affiliated with the World Anti- 
Communist League, and with a Swedish magazine, Contra, 
which propagandizes for "freedom fighters" in Angola, Af- 
ghanistan, and Central America. 

Reuters, Sept. 30: "Ex-Rhodesian Denies Palme Murder 
Accusation," names Anthony White as the accused Palme 
assassin, and reports on an interview that White gave, from 
his timber business in Beira, Mozambique. White denies any 
involvement in the Palme assassination, telling Reuters: "I 
can only express extreme shock and disappointment. It's un- 
true, I was not involved." Reuters also interviews White's 
former commanding officer in the Selous Scouts, Ron Reid- 
Daly, who states, "We're all totally pissed off at these cowards 
who are trying to put the blame onto everyone else." 

Corriere della Sera, Sept. 30: The Italian daily's Mas- 
simo Nava writes a detailed report on the South Africa "reve- 
lations," including a reference to the role of the East German 
secret service, the Stasi, in the disinformation campaign to 
blame the Palme murder on Swedish associates of Lyndon 
LaRouche: "As in any other excellent murder, the script in- 
cludes the arrest of a culprit and a deflection. Chief of Police 
Holmer arrested Viktor Gunnarsson, sympathizer of the 
American LaRouche movement. Gunnarsson was acquitted, 
and moved to the United States. In 1994 he was killed with 
two pistol shots in his head. Two years earlier, a former agent 
of the Stasi, the secret police of Communist Germany, had 
revealed to a Swedish magazine his disinformation activity 
on the Palme case." 

Nava also focus ses on the international arms cartel as 
one key factor in the Palme murder: "In the spiderweb, the 
international weapons connection is the most credited and 
could cross the South African one. Mainly, the one casting 
shadows on the Swedish establishment and on a candid image 
of a country, neutral and peace-loving, drawing much of its 
wealth from weapons sales. While Olof Palme was appointed 
by the UN as mediator in the Iran-Iraq War, dossiers have 
been uncovered on the illegal export of heavy weapons, can- 
nons, and missile-launchers produced by several companies 
headed by Bofors. A system of triangular flows, extending to 
India, Dubai, and Singapore, comes into the open. Palme was 
certainly aware of it, and wanted to stop it. In this chapter 
there is another perfect murder, that of Adm. Carl Frederick, 
head of the export controls office, who 'fell' on the rails of 
the Stockholm subway." 

Aftonbladet and Expressen, Oct. 1: Both papers report 
on additional statements by former Williamson associates, 
linking him to the Palme assassination. Peter Casselton, who 
helped Williamson blow up the London headquarters of the 
African National Congress (ANC) in 1982, tells the press that 
"one individual living in Turkey killed Palme." Both White 
and Williamson helped him, Casselton says. Both papers re- 
port that Bertil Wedin is living in the Turkish side of Cyprus, 
and speculate that he is the man being referred to by Casselton. 

Aftonbladet, Oct. 2: The paper interviews Wedin, who 
confirms links between the Palme assassination and the activi- 
ties of the international weapons cartel. "I have information 
that might be of interest to the investigator of the Palme mur- 
der," Wedin tells Aftonbladet. "It is about the war between 
Iran and Iraq, and it is about the trucks. Iraq did not like the 
fact that Sweden and Volvo sold trucks to Iran during the 
war. When, in addition, Olof Palme became the negotiator, it 
became too much for them. I have a lot of information that 
the Palme group needs to know about." 

ABC, Oct. 2: Villar Mir, the Spanish daily's correspon- 
dent in Stockholm, reports that Swedish police are taking 
the "South African track" in the Palme investigation very 
seriously. Two Swedish police have come forward stating 
that, on the night of the Palme assassination, they saw An- 
thony White within several hundred meters of the scene of 
the murder. Villar Mir also reports on new statements by Dirk 
Coutzee, identifying Lars Tander, a man who served with 
White in the same commando unit, as one of his sources on 
White's involvement in the Palme assassination. The article 
concludes by reporting that, in 1985, at the request of Wilhelm 
de Klerk, the brother of the President of South Africa, Palme 
had conducted secret negotiations in Zambia, Sweden, and 
Senegal, to negotiate the end of apartheid. 

Aftonbladet, Oct. 3: It reveals that Craig Williamson had 
a British superior in Operation Longreach. "Longreach was 
directed by Michael Irving, a former high-ranking British 
naval officer." Irving used Williamson as a consultant, and as 
a contact man with South African intelligence. Aftonbladet 
reports that Longreach, and the affiliated company GMR, 
spied on anti-apartheid activists, and worked to break the 
embargo of South Africa, by smuggling oil and weapons into 
the country, using the Seychelles Islands as a base for their 
operations. Aftonbladet also identifies two Swedes, now re- 
siding in South Africa, Raoul Kjellqvist and Jan von Sydow, 
as participants in an unsuccessful 1981 coup d'etat against 
the Seychelles government. Von Sydow is identified as the 
"banker" for well-known mercenary "Mad Mike" Hoare. 

Aftonbladet, Oct. 4: Magdalena Kvarning writes that, 
according to an unnamed former South African police offi- 
cial, South African intelligence participated in the assassina- 
tion of Olof Palme, because of Palme's opposition to apart- 
heid, and because Palme specifically interfered to stop several 
arms shipments to Iran, via South Africa. "Armsfront, a mili- 
tary branch, was to export a large amount of explosives to Iran. 
This was stopped by Palme four weeks before the murder," the 
source told Aftonbladet. The source also stated that William- 
son and his company, Longreach, were involved in the 
Palme assassination. 

In a separate article, Aftonbladet reports that former 
Swedish police investigator Tommy Lindstrom, who had 
been involved in the Palme investigation, visited Eugene de 
Kock in prison in South Africa. De Kock reiterated the role 
of Williamson in the murder of Palme, and cited Inkatha Free- 

14 October 1996 

EIR Special Report 

* - 'it,,* 5 * 8 ' 

Sv.i&.vW. . ..- _. 



dom Party senator and former police officer Philip Powell as 
his source on the murder plot. De Kock tells Lindstrom that 
Powell was himself a part of the plotters' group. De Kock 
promises that, in the near future, he will reveal the name of 
the shooter of Palme. He disputes Coutzee and Casselton's 
identification of White or Wedin as the shooters, although he 
confirms their ties to Williamson. 

Expressen, Oct. 4: Prints a letter from Mari Sandstrom, 
a former Swedish secretary of information at the UN Refugee 
Commission in Geneva, which provides further details on the 
Palme assassination plot and the South African connection. 
Sandstrom writes to the Palme Investigative Commission that 
she was told by an unnamed member of South African intelli- 
gence that three South Africans traveled to Germany shortly 
before the Palme murder, to prepare the details of the killing, 
in league with a German man, Fraz Esser. Shortly after the 
Palme murder, Esser died in a car accident. According to 
Sandstrom' s letter, there were others on the same "hit list" as 
Palme, including Mathias Hinterscheid and Sir Alfred Beit, a 
South African resident involved in the diamond trade. Sand- 
strom tells the commission that the murders of ANC officials 
Griffiths Mxenge (1981), and his wife, Victoria Mxenge 
(1985), are directly related to the Palme case. 

El Pais, Oct. 4: The Spanish daily reports South African 
President Nelson Mandela' s statement on the new Palme rev- 
elations: "We have to adopt special measures, to ensure that 
justice is realized, in the case of the assassination of Olof 
Palme," says Mandela. While acknowledging that it is not yet 
clear whether De Kock "will hold up to cross-examination," 
Mandela notes, "Sweden is playing an important role in facili- 
tating development and reconstruction in our country. There- 
fore we take a personal interest that this matter will be thor- 
oughly investigated." Mandela calls upon the leadership of 
the National Party to fully cooperate. 

Washington Post, Oct. 4: "New Tales of Old Killing Stir 
Intrigue in S. Africa — Links to Slaying of Sweden's Palme 
Probed," by Lynne Duke, provides the first detailed account 
in the U.S. press, of the accusations by de Kock and Coutzee. 

probe has been reinvigorated, and a team of Swedish investi- 
gators is to arrive here soon to work on the case with South 
African justice authorities." 

Observer, Oct. 6: The London daily's article, entitled 
"Which South African Agent Killed Sweden' s Olof Palme?" 
by Ruaridh Nicoll, names another leading South African 
apartheid-era counterinsurgency official who may have been 
involved in the Palme murder. Nicoll references "the gro- 
tesquely named Civil Co-Operation Bureau (CCB)," headed, 
at the time of Palme's murder, by Eeben Barlow, "now head 
of the profit-making mercenary outfit Executive Outcome," 
as a likely suspect, along with Williamson, et al. Barlow is 
described as the head of CCB's Region 6, "responsible for 
Western Europe." While CCB's activities in other areas have 
been widely exposed, Nicoll notes that what happened in 
Region 6 "remains a mystery." 

Kronen Zeitung, Oct. 6: The Vienna daily raises the 
pos sibility that the bombing of Pan Am Flight 103, over Lock- 
erbie, Scotland, in December 1988, was carried out by the 
same South African networks now accused of the Palme as- 
sassination. Palme's close friend and aide, Bernt Carlsson, 
was killed in the Pan Am 103 explosion. He had just been 
appointed as the new United Nations High Commissioner 
for Namibia, "and was seen as a threat against the apartheid 
regime." Carlsson, while Palme was alive, had been his per- 
sonal liaison to Yasser Arafat, head of the Palestine Liberation 
Organization. He had worked with Palme on the UN Commis- 
sion, assigned to impose the arms embargo on Iran and Iraq 
during their war in the 1 980s, and, even after Palme' s death, 
Carlsson had made a number of fact-finding trips of his own 
to the Persian Gulf. 

Expressen, Oct. 8: The Swedish daily reports on the Kro- 
nen Zeitung story, linking the South Africans to the Lockerbie 
massacre. According to Expressen 's account, in May 1989, 
the London Independent reported that the U.S. Federal Bu- 
reau of Investigation suspected that the bomb that blew up 
the plane had been planted in Carlsson' s luggage. 

Swedish TV Channel 1, Oct. 9: The "news -magazine" 

per Arbeiterbladet, that he was with Craig Williamson in 
Stockholm a week before the Palme murder. The man claims 
that he was the chauffeur for another Norwegian, a wealthy 
businessman who gave a large amount of cash to Williamson. 
The source came forward after the Scandinavian media pub- 
lished pictures of Williamson, following the de Kock and 
Coutzee revelations. 

Dagens Eko, Oct. 10: The Swedish daily reports that the 
head of the Swedish police unit probing the Palme assassina- 
tion, and the assistant prosecutor, have arrived in Johannes- 
burg, South Africa. Hans Olvebro and Jan Daneilsson are 
scheduled to meet with South African prosecutors and review 
the tapes of the interrogations of Eugene de Kock. 

La Prensa, Oct. 11: The Argentine daily publishes the 
entire Sept. 30 Corriere della Sera article by Massimo Nava, 
on the Palme assassination revelations. 

Washington Post, Oct. 13: "Nuremberg in South Af- 
rica — A Bland Hit Man Details Apartheid's Secret War," by 
Allister Sparks, provides further background on Eugene de 
Kock, "the old South African regime's chief assassin." De 
Kock, on trial for the past 19 months on 89 charges of murder, 
conspiracy, and fraud, is described as the chief of the apart- 
heid regime's most sophisticated hit squad, C-10, which as- 
sassinated many ANC leaders, and orchestrated the "Third 
Force," black-on-black violence of the final years of the Na- 
tional Party governments. Sparks provides the following brief 
profile of de Kock's career: "Now 47, de Kock has been in 
the killing business all his adult life. He began in the 1960s, 
fighting in a South African police unit sent to support Ian 
Smith's white minority government in Rhodesia. After that 
he transferred to Namibia and Angola, where he learned the 
skill of turning captured black guerrillas against their own 
kind. He became a commander of the notorious 'Koevoef 
(crowbar) police unit, made up largely of turned Angolan 

freedom fighters who acquired a reputation for mass atrocities 
against civilians." 

De Kock's C-10 operated out of a farm near Pretoria 
called Vlakplaas, where they trained "askaris," captured ANC 
soldiers who were "turned" as C-10 agents, and then trained 
to be some of the most brutal killers. C-10 also trained special 
units of KwaZulu Chief Minister Mangosuthu Buthelezi's 
Inkatha Freedom Party, at a secret camp near Ulundi, the 
capital of the Kwazulu homeland. "This, Sparks writes, 
"clearly was the genesis of the so-called Third Force alluded 
to by Nelson Mandela during the black civil war that ravaged 
the Zulu people and claimed more than 20,000 lives before 
the 1994 elections." 

Der Spiegel, Oct. 14: The German weekly details the 
new South Africa connection revelations, and highlights a 
British Intelligence MI-6 report that was provided to Swedish 
police investigators shortly after the Palme assassination, in- 
dicating that a member of the South African police Koevoet 
unit, with Swedish police collaborators, carried out the Palme 
murder. The MI-6 memo identified Craig Williamson as the 
operations chief for the assassination plot. Der Spiegel re- 
views Williamson's role as an infiltrator of the Internationa] 
University Exchange Fund, a financial conduit for the ANC, 
and his close work with Bemt Carlsson and Gunnar Eriksson, 
both close collaborators of Palme. Carlsson was killed in the 
explosion of Pan Am Flight 103. 

Der Spiegel also reports on a dossier, assembled in May 
1987 by Mari Sandstrom, the Geneva correspondent for the 
Swedish newspaper Svenska Dagbladet. Sandstrom received 
information from a participant in an international police con- 
ference in Johannesburg, South Africa, where the Palme as- 
sassination plot was discussed. Spiegel reports that, according 
to Sandstrom' s source, plans for the Palme murder began in 
1982, shortly after his election as prime minister. 

16 October 1996 

EIR Special Report 


Chapter 2 

John Train: Wall Street's man 
in Bush's secret government 

A. Train's global tracks 

John Train, investment banker, writer, Anglophile, spook, 
is a sort of "red dye," a marker for secret government opera- 
tions tied to the international killer apparatus centered on 
George Bush and the international explosives cartel. From 
Sweden to Africa, from France to Afghanistan, from London 
to New York, you will find the tracks of John Train. 

And, naturally enough, Train played a direct and crucial 
role in laying the propaganda groundwork for the frame-up 
and prosecution of Lyndon LaRouche: It was at his New York 
apartment that a series of meetings were held in 1983-84 
which launched and coordinated news media attacks on 
LaRouche; these media attacks laid the groundwork for laun- 
ching federal grand jury investigations of LaRouche and his 
associates from 1984 through 1988. This effort was an inte- 
gral part of the Bush "Ministry of Propaganda," officially 
designated as "Public Diplomacy" during the Reagan-Bush 

Train' s role as chief propagandist in the "Get LaRouche" 
drive reflected his standing as a key figure in the Wall Street 
wing of the official American intelligence establishment. Fi- 
nancial community sources describe the investment coun- 
selor as one of the "top spooks" on Wall Street; others call 
him "the last of the OSS 'old hovs' on Wall Street." referring 

In 1958, Train set up his own New York-based investment 
counseling and brokerage firm, Smith, Train Counsel. Reuters 
news service reported in 1985: "Some of America's wealthi- 
est families have entrusted more than $500 million to invest- 
ment counselor John Train." 

Although Train' s initial source of funds and client list are 
shrouded in secrecy, some sources believe he might handle 
the family funds of the Gardner family of New York, Maurice 
"Hank" Greenberg of the American International Group, and 
Richard Mellon Scaife. 

In 1984, Train sold a 50% interest in Smith, Train Counsel 
to the English Association Trust (EAT) of London. During 
the 1980s, EAT was a wholly owned subsidiary of the English 
Association Group, which, in turn, was a wholly owned sub- 
sidiary of PK Banken of Sweden, of which the Swedish gov- 
ernment was the largest shareholder. In 1987, Erik Penser, a 
major shareholder in Nobel and its subsidiary, Bofors, took a 
20% interest in PK Banken. 

One of the two board members whom EAT placed at 
Smith, Train Counsel was Richard Cox-Johnson, who was 
formerly with N.M. Rothschild and Sons, Ltd. Before a more 
recent reorganization, Train sat on the boards of PK English 
Trust Co. of London, and PK Bank of New York. 

A long Train of abuses 

The Trains, who renortedlv first arrived in the Massachu- 

John Train's British, 
Swedish financial ties 

At the time of the 1986 assassination of Swedish Prime 
Minister Olof Palme, the firm Smith, Train Counsel was a 
subsidiary of the Swedish government-owned PK Banken 
(now known as Nordbanken). In 1984, Smith, Train Coun- 
sel had sold a 50% share in the firm to English Association 
Trust (EAT). This was a wholly owned subsidiary of En- 
glish Association Group, which was in turn a wholly 
owned subsidiary of PK Banken. 

After the October 1987 stock market crash, one Erik 
Penser traded 90. 1 % of his stock trading firm Carnegie, 
for a 20% share of PK Banken, which left the Swedish 
government with 67% control of PK Banken. Smith, Train 
Counsel remained a subsidiary of PK Banken for some 
years after this merger. 

Penser was also a major shareholder in Nobel, whose 
wholly owned subsidiaries included the Swedish arma- 
ments maker Bofors. Shortly before his assassination, 
Prime Minister Palme had been pursuing an investigation 
into bribery and illegal arms dealings by Bofors. Out of 
this investigation initiated by Prime Minister Palme, came 
a 1987 raid in Malmo, Sweden and subsequent charges 
against one of Penser' s top arms-traffickers, Karl-Erik 
"Bobbo" Schmitz. 

In 1989, the Swedish National Appeals Court, Hovratt, 
chose to retry the case against Schmitz and Bofors market- 
ing executive Mats Lundberg, claiming that the Swedish 
County Court had overlooked major evidence that showed 
the alleged sale of explosives to Iran, which would be 
illegal under Swedish law. Schmitz had been making trips 
to Iran to arrange deals during the same time period cov- 
ered by the "Iran-Contra" scandal. Schmitz had also been 
involved in arms deals with South Africa, which Prime 
Minister Palme had fought against as part of an anti-apart- 
heid boycott. County Court Prosecutor Stig Age had al- 
ready charged that Schmitz' s clients (which included Iran) 
also included Syria and East Germany, among other for- 
bidden destinations. 

Since the Palme era, the direct financial connection 
between Smith, Train Counsel, and PK Banken and its 
successor Nordbanken, with Erik Penser, has been broken. 
When the connection was first made, EAT became PK 
English Trust Group Pic. However, PK English Trust 
Group Pic reorganized to buy back its shares held by PK 
Banken and also purchase PK Banken' s stock-dealing sec- 
tion — i.e., the Carnegie section that Erik Penser had traded 
to gain a 20% share of PK Banken. The firm is now the 

The front and back cover of one of John Train 's books. The Wall 
Street Anglophile banker ran the "Get LaRouche" propaganda 
offensive, and served as a key "bridge" between British and 
American intelligence networks during the 1980s, 

London-based English Trust Group Pic, and John Train 
is an honorary director; however, English Trust Group Pic 
retains a large share of Smith, Train Counsel, now called 
Train, Smith Investment Counsel. 

English Trust Group Pic has gone through a succession 
of reorganizations since its founding, as did its subsidiary 
Smith, Train Counsel. Originally, in the 19th century, the 
English Trust Group Pic was known as the English Associ- 
ation of American Bond and Shareholders; it dealt 
mainly in American railroad stocks. Its next transforma- 
tion was as English Association Trust, which purchased 
50% of Smith, Train Counsel in 1984. 

18 October 1996 

EIR Special Report 


Roy Godson, son of a 

longtime CIA-State 

Department operative, is 

top-level "private" 

intelligence operative. He 

was a consultant to the 

President's Foreign 

Intelligence Advisory 

Board (PFAIB) and other 

agencies in the Bush era, 

and a liaison between the 

White House "Public 

Diplomacy" operation 

and John Train's "Get 

LaRoucke" salon. Godson 

began tracking LaRouche 

as early as 1968. 

his cousins provide for the London-centered European oligar- 
chy today. 

Train married into an old Venetian family, the Cini, in 
1961 . His wife, whom he divorced in 1 976, was Maria Teresa 
Cini di Pianzano. She is the daughter of Vittorio Cini, a key 
figure in the fascist Italy of the 1930s, who later founded the 
Cini Foundation of Venice. Maria Teresa is well-connected 
in Sweden, and even wrote a book on "Swedish castles." 

In 1976, Train was decorated "commendatore Ordine del 
Merito della Repubblica," and "commendatore Ordine della 
Solidarieta," by Italian President Giovanni Leone. (An in- 
quirer was told a few years ago that the matter of Train' s 
decorations was a state secret, that all the relevant documents 
had been sent from the President's office, the Quirinale, to 
the police, the Carabinieri, and were carefully hidden away, 
and that nothincr further would he said about ith 

Russell Train, was for many years the chairman of the 
World Wildlife Fund for Nature-U.S. (WWFN), headed the 
Environmental Protection Agency, and is a trustee emeritus 
of the African Wildlife Foundation. He is a close friend of 
both George Bush and the Duke of Edinburgh, Prince Philip. 

Sen. Claiborne Pell (D-R.L), the ranking member on the 
Senate Foreign Relations Committee, served in the U.S. Navy 
during World War II, then joined the U.S. State Department, 
which stationed him in Prague, Czechoslovakia, where he 
was active in eastern European emigre matters. He next joined 
up with Leo Cherne, a close associate of John Train in "Public 
Diplomacy" circles (see below), and served as vice president 
and director of the International Rescue Committee (IRC). 
(Pell is also a raving New Age kook.) Partisan differences 
aside, Pell lets his cousin John Train handle his money, as he 
acknowledged in his introductions to two of Train's books. 

'Paris Review' and the Goldsmith brothers 

The roots of John Train' s role as one of the Anglo-Ameri- 
can oligarchy's leading psychological warriors goes back to 
Paris in the 1950s, when he was among the principal founders 
of the Paris Review, a literary journal and halfway house for 
some of the biggest degenerates to leave their mark on 20th- 
century culture. Paris Review not only gave new life to such 
discredited fascist apologists as Ezra Pound and communist 
fellow-travelers such as W.H. Auden, but also pioneered the 
"psychedelic" drug movement which blossomed a decade 
later as the drug-rock-sex counterculture. 

Paris Review was founded in 1 95 1 . Train served as man- 
aging editor in 1952-54 and 1957-59, and he has remained 
an advisory editor since then. Paris Review's publisher was 
Train's Harvard roommate and friend, Prince Sadruddin 
Agha Khan. 

The Agha Khans provide one of the bridges to another 
tier of oligarchy associated with John Train. Not only have 
the Agha Khans been intimates of the British royal family 
since Queen Victoria, but Prince Sadruddin, who has re- 
mained John Train's friend sinr.e their Harvard davs is akn 

Train is the founder and former chairman of the Afghani- 
stan Relief Committee (ARC), which he established in 1980, 
and which is housed in his offices. The ARC s stated purpose 
was to raise "seed money" for medical organizations treating 
mujahideen casualties; its base of operations was at Peshawar, 
Pakistan, near the Afghan border. Peshawar was the chief 
transit point for the arms pipeline into Afghanistan, and a 
center of the arms- and drug-trade. Train' s ARC worked espe- 
cially closely with the Afghan faction around Gulbuddin Hek- 
matyar, an anti-Western "fundamentalist" whose operations 
were heavily financed through drug- trafficking. 

Train's ARC also worked closely with the International 
Rescue Committee of Cherne and CIA Director William 
Casey, which had a base of operations in Peshawar. Cherne, 
at the time, was the vice chairman of the President' s Foreign 
Intelligence Advisery Board (PFIAB), and the chairman of 
Freedom House. 

Train's ARC was very closely tied to Cherne' s Freedom 
House, which had its own Afghanistan Information Center, 
headed by Rosanne Klass, who was also the vice president of 
Train's ARC. Freedom House's treasurer, Walter Schloss, 
was a longtime business associate of Train. ARC likewise 
worked very closely with Prince Sadruddin Agha Khan, who 
was named coordinator of United Nations Humanitarian and 
Economic Assistance Programs for Afghanistan in 1988, and 
with the National Endowment for Democracy. 

In 1984, Train was appointed by President Reagan to the 
board of the African Development Foundation, which has 
been a conduit for millions of dollars to Africa from the U.S. 
State Department Agency for International Development. He 
was confirmed in this post at hearings chaired by Senator Pell, 
his cousin, who was then chairman of the Senate Foreign 
Relations Committee. 

Other positions held by Train include: 

• Overseer, National Endowment for Democracy, Inter- 
national Forum for the Study of Democracy 

• Director, International Rescue Committee 

• Former governor, East- West Center (Hawaii) 

• Director, Bulgarian- American Enterprise Fund 

• Honorary chairman, British Natural History Museum 
International Foundation (London) 

• Former trustee and director, World Monuments Fund 

• Member, Council on Foreign Relations 

• Member, International Institute of Strategic Studies 

• Director, Genesis Emerging Markets Fund (London) 

• Founder and chairman emeritus, Train, Smith Invest- 
ment Counsel 

B. Public diplomacy 

Beginning no later than April 1 983 (just weeks after Presi- 
dent Ronald Reagan' s March 23 announcement of the Strate- 

gic Defense Initiative), John Train convened the first of a 
series of salon sessions in his New York City townhouse, for 
the purpose of planning out and coordinating a news media 
campaign of defamation against LaRouche and his political 

The "Train salon," as it came to be known, was a project 
of the Public Diplomacy operation centered in the Reagan- 
Bush National Security Council. 

In this section, we will review the structure and back- 
ground of the Public Diplomacy project, and in the next sec- 
tion, we shall examine the nefarious workings and output of 
the "Train salon" itself. 

The 'Ministry of Propaganda' 

The Sept. 7, 1988 Staff Report on State Department and 
Intelligence Community Involvement in Domestic Activities 
Related to the Iran-Contra Affair, of the House Committee 
on Foreign Affairs, concluded: 

"Senior CIA officials with backgrounds in covert opera- 
tions, as well as military intelligence and psychological opera- 
tions specialists from the Department of Defense, were deeply 
involved in establishing and participating in a domestic politi- 
cal and propaganda operation run through an obscure bureau 
in the Department of State which reported directly to the Na- 
tional Security Council rather than through normal State De- 
partment channels." 

An article in the Fall 1988 issue of Foreign Policy maga- 
zine, entitled "Iran-Contra' s Untold Story," reported that "the 
White House [had] created a sophisticated apparatus that 
mixed propaganda with intimidation, consciously misleading 
the American people and at times trampling on the right to 

"Congressional investigators did draft a chapter about the 
domestic side of the scandal for the Iran-Contra report," the 
Foreign Policy article continued, "but it was blocked by 
House and Senate Republicans. Kept from the public domain, 
therefore, was the draft chapter's explosive conclusion: that 
. . . senior CIA covert operatives were assigned to the White 
House to establish and manage a covert domestic operation 
designed to manipulate the Congress and the American 

EIR has put together the most comprehensive picture of 
how the "secret government" apparatus of the 1980s was cre- 
ated, and has shown that it functioned under the direct control 
of Vice President George Bush, operating through the Na- 
tional Security Council — and not the CIA (see EIR Special 
Report, "Would a President Bob Dole Prosecute Drug Super- 
Kingpin George Bush," September 1996, Chapter 2). 

"Crisis management" is the key to understanding how 
George Bush became the covert operations "tsar" of the 
Reagan administation. Step by step, it worked like this: 

1 . In the early months of the Reagan-Bush administration 
in 1981, there was a brawl between George Bush and Secre- 
tary of State Al "I'm-in-charge-here" Haig over the control 

20 October 1996 

EIR Special Report 

July II. 1»1J 

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Attached ar* two HONa foe th* Vic* 
Pre*id«nt. Sine* I am th* n*w h*ad 
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Declassify on: OADR 

S E C R ET- 

Out of the loop? This July 12, 1983 memorandum, from NSC 
official Kenneth DeGraffenreid to Bush 's aide Adm. Dan Murphy, 
asks for an immediate meeting to review procedures for getting 
Vice President Bush 's comments and concurrence on all covert 
actions planned by the National Security Planning Group, and on 
all Memorandums of Notification (MONs). DeGraffenreid had just 
taken over Walter Raymond's position as head of the NSC 
Intelligence Directorate. One of the MONs which DeGraffenreid 
had on his desk at the time, according to NSC documents dated 
July 11 and July 13, was a notification of increased spending on 
covert action for Nicaragua. 

guidance, and direction of all foreign intelligence, counterin- 
telligence, and "special activities" (i.e., covert operations). 
This effectively put the NSC in charge of the CIA, military 
intelligence, special operations, and so on. This did not mean 
that the President's national security adviser would assume 
this charge, but the NSC staff structure — which is not a staff 
for the cabinet-level National Security Council, but for the 
White House — over which Bush increasingly assumed 

A little-noticed provision of E.0. 12333 gave the CIA the 
exclusive conduct of "special activities" (covert operations), 
"unless the President determines that another agency is more 
likely to achieve a particular objective." This, for the first 
time, officially opened the door for assigning covert opera- 
tions to the NSC staff. 

Furthermore, in a provision which was almost the "char- 
ter" for Bush's secret government, Section 2.7 of E.O. 12333 
permitted U.S. intelligence agencies to enter into secret con- 
tracts for services with "private companies or institutions." 

3. On Jan. 12, 1982, National Security Decision Directive 
Number 2 (NSDD-2) was issued, which formalized the Na- 
tional Security Council structure. It confirmed the existence 
of a series of Senior Interagency Groups (SIGs) for foreign 
policy, defense policy, and intelligence — thus reducing the 
power of the secretary of state and other department heads. 

4. A month earlier, on Dec. 14, 1981, NSDD-3 had already 
been signed. Entitled "Crisis Management," it affirmed the ex- 
istence of the Special Situation Group, which, it said, would 
be "chaired by the vice president," and assigned to the SSG 
responsibility for crisis management. "Crisis Management" 
was defined as encompassing "a national security matter for 
which Presidential decisions and implementing instructions 
are required more rapidly than routine interdepartmental NSC 
staff support provides." This formalized George Bush's con- 
trol over intelligence and covert operations. 

5. On May 14, 1982, the first phase of the Bush takeover 
was completed, with the issuance of an extraordinary memo- 
randum entitled "Crisis Pre-Planning," bv the national secu- 

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The March 3, 1983 
memorandum from 
Walter Raymond, which 
proposed that President 
Reagan meet with 
potential private donors 
for the Public 
Diplomacy project on 
Europe. The planning 
group included key 
funders of the "Get 
LaRouche" task force, 
such as the Mellon- 
Scaife and Smith- 
Richardson foundations. 

jected in May 1983, but he was overridden. 

Incidentally, the May 12, 1982 memorandum directed 
each participating agency to provide the name of its CPPG 
representative to the CPPG coordinator — Oliver North. 

6. On April 10, 1982, President Reagan was induced to 
sign NSDD-30, on "Managing Terrorist Incidents." This di- 
rective said that if a terrorist situation warranted it, the Presi- 
dent' s national security adviser could convene the SSG "at 
the direction of the vice president" — i.e., George Bush. 
NSDD-30 created the "Terrorist Incident Working Group" 
(TIWG, or "Tee-wig"), to support the SSG. TIWG was com- 
posed of representatives of the State Department, CIA, De- 
fense Department, Federal Emergency Management Agency 
(FEMA), and the NSC staff, and was to be chaired by a repre- 
sentative of the NSC staff, which, before too long was — 
Oliver North. 

7. Another, closely related, area under Bush's control be- 
ginning in 1981, was the "Continuity of Government" pro- 
gram for "emergency preparedness." The Miami Herald, in 
1987, called the Continuity of Government program "a virtual 
parallel government," and reported that it included a plan "to 
suspend the Constitution in the event of a national crisis." 

A New York Times article, on April 18, 1994, described 
the "Doomsday Project" as involving more than 20 highly 
classified "black programs," in military and intelligence agen- 
cies; it also involved private companies run by retired military 
and intelligence personnel. The Times reported that, during 

the Reagan administration, "the project was supervised by 
Vice President George Bush." Oliver North wrote in his auto- 
biography Under Fire that this was his first major project at 
the NSC, and that this was where he came to know Vice 
President Bush. FEMA was the public side of this program. 
It was thus that, during the Reagan administration, all 
intelligence and foreign policy "crisis management" was con- 
solidated, as much as possible, under the operational control 
of the Vice President of the United States, George Bush. 

Donald Gregg and Walter Raymond 

Donald P. Gregg, a CIA officer since 1951, was detailed 
to the Carter administration NSC staff in 1979, and was re- 
garded by some as a Reagan-Bush "mole" during the 1980 
election campaign, keeping an eye out for any sort of "October 
Surprise." The new administration requested that Gregg re- 
main at the NSC, and he headed the NSC' s Intelligence Direc- 
torate until 1982. In August 1982, he formally resigned from 
the CIA to become Bush's national security adviser, and he 
remained in that position until 1989. 

In July 1982, Gregg recommended that Walter Raymond, 
a CIA officer experienced in the CIA's clandestine overseas 
media program, who been been seconded to the U.S. Army 
for much of his career, be posted to the NSC to replace Gregg. 
One of Raymond's two deputies in the NSC Intelligence Di- 
rectorate was Kenneth DeGraffenreid (who succeeded him in 
this position in 1983). 

22 October 1996 

EIR Special Report 

Raymond later testified that his responsibilities included 
reviewing intelligence community programs for the Senior 
Interagency Group/Intelligence (SIG/I, created by NSDD-2), 
including covert operations and counterintelligence pro- 
grams. But Raymond had a particular specialty: He was re- 
garded by some as the CIA's leading propaganda expert. 

In June or July 1983, Raymond was made international 
director of communications for the NSC, with the concurrent 
title of special assistant to the President. As he later explained 
it, he had been urging this reorganization upon then-National 
Security Adviser Bill Clark for months, to help "fight the war 
of ideas." Shortly before this, Raymond resigned from the 
CIA to avoid "contamination" (his word) of the Public Diplo- 
macy effort by overt ties to the CIA. 

UnderE.0. 12333, the definition of permitted covert oper- 
ations excluded those activities intended "to influence United 
States political processes, public opinion, policies, or media." 
Either Bush, Gregg, and Co. conveniently interpreted this 
prohibition as not covering the NSC staff, or else they simply 
chose to ignore it. 

The "Public Diplomacy" effort was part of the broader 
"Project Democracy" announced by President Reagan in a 
speech to the British Parliament on June 8, 1982. In January 
1983, Reagan signed NSDD-77, entitled "Management of 
Public Diplomacy Relative to National Security." Authored 
by Raymond, among others, NSDD-77 called for strengthen- 
ing "the organization, planning, and coordination of the vari- 
ous aspects of the public diplomacy of the United States." 
Under NSDD-77, a cabinet-level "Special Planning Group" 
was created, with an executive committee composed of repre- 
sentatives from the Defense Department, State Department, 
and U.S. Information Agency. (One of the DOD representa- 
tives to the Public Diplomacy SPG was Craig Alderman, also 
a top DOD representative to FEMA and the "Continuity of 
Government" apparatus.) 

Raymond also headed the interagency Central American 
Public Diplomacy Task Force, even before he assumed his 
new position in July 1983. Out of this came the creation of 

eral Departments and agencies. No single agency can do it 
alone nor should it." Attached was a chart, entitled "NSDD- 
2 Structure for Central America," which put the NSC between 
the President and the secretary of state, and which placed 
Bush' s Special Situation Group on the same level as the NSC. 
This, as we identified above in the discussion of NSDD-2 and 
3, marked the consolidation of Vice President Bush's control 
over covert operations policy. 

S/LPD was headed by Otto Reich, a former Democrat 
who had become a "neo-con" Republican. Reich contracted 
out most of his work, particularly to International Business 
Communications (IBC), which became a subject of much 
examination during the "Iran-Contra" investigations. IBC 
then got busy placing op-ed pieces, feature articles, and let- 
ters-to-the-editor in major newspapers and magazines, with- 
out ever identifying that they originated in an official U.S. 
government agency. 

IBC also facilitated the transfer of funds raised by North 
and company (including by Roy Godson and Richard Mellon 
Scaife) to Swiss and offshore banks accounts. 

Military psy-ops 

Important insight into how the NSC Public Diplomacy 
operation worked is provided by a January 1986 memoran- 
dum from Reich to Raymond. Reich says that during 1985, 
five personnel from the 4th Psychological Operations Group 
of the U.S. Army had been detailed to S/LPD. Then Reich 
complained to Raymond that the Department of Defense had 
turned down his request for four more psy-ops personnel. At 
that time, the 4th Psy Ops Group, stationed at Fort Bragg, 
functioned under the Army Special Operations Command, 
which, in turn, was subordinate to the Joint Chiefs of Staff 
J-3 Joint Special Operations Agency — a favored and primary 
instrumentality for Bush' s secret government apparatus. (The 
4th Psy Ops Group was a regular recipient of military intelli- 
gence communications reporting on activities of the 
LaRouche movement in Europe and elsewhere.) Air Force 
intelligence personnel were also detailed to S/LPD. 

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Memorandum for the 
President from William 
P. Clark, March 18, 
1983, drafted by Walter 
Raymond, along with 
talking points and a list 
of participants for the 
March 21 "private 
donors " meeting with 
the President. 
Participants included 
Jimmy Goldsmith, 
Joachim Maitre, and 
Rupert Murdoch (owner 
of the London Times and 
the New York Post). 

When Raymond's deposition was taken by the Congres- 
sional Iran-Contra committee in 1987, Raymond was asked 
about his 1983 recommendation to hire Michael Ledeen (see 
Chapters 1 and 4). Ledeen had left the State Department in 
1982 along with Haig, and Raymond wanted him back. Why? 
"He is a good writer," was Raymond' s answer. 

Public Diplomacy targets Europe 

In a revealing, Jan. 25, 1983 memorandum, Raymond 
wrote that the President had signed NSDD-77 , "solidly endor- 
sing our course of action." He called the Public Diplomacy 
program "a new art form," and declared: "Programs such as 
Central America, European strategic debate, Yellow Rain and 
even Afghanistan have foundered by a failure to orchestrate 
sufficient resources & focus to these efforts." Raymond pro- 
posed that the public-private effort needed to be supple- 
mented with "private funds," and he said that preparation 
was under way for a meeting of "potential donors" with the 
President. A broader donors' group was needed, Raymond 
wrote: "We can not, forever, rely on one or two good souls, 
such as Smith-Richardson or Mellon-Scaife." 

The priority areas of concern listed in Raymond's memo- 
randum were: European security and the Intermediate Nu- 
clear Forces (INF) treaty, Central America, Afghanistan, and 
Yellow Rain. Although the Congressional investigations fo- 
cussed most of their attention on Central America, the fact is 
that Europe, not Central America, was the primary focus of 

the Public Diplomacy project at its inception. This sheds sig- 
nificant light on the targetting of LaRouche by this same 
group, which occurred simultaneously with the efforts docu- 
mented in the records of congressional investigations. 

On March 3, 1983, Raymond sent a classified memoran- 
dum to National Security Adviser William Clark proposing 
that the President meet with a group of potential funders of 
"public diplomacy" efforts. Raymond described two meet- 
ings that had already been held with "private sector" people. 
The group which Raymond described, just happened to in- 
clude a number of individuals who were also directly involved 
in efforts against LaRouche, such as a representative of Rich- 
ard Mellon Scaife, a representative of the Smith-Richardson 
Foundation (which later financed the Dennis King book slan- 
dering LaRouche), Leonard Sussman andLeo Cherne of Free- 
dom House, and Roy Godson. 

The meeting with President Reagan was held on March 
21, 1983, and included Jimmy Goldsmith, Carl Lindner, Joa- 
chim Maitre (representing the German publisher Axel 
Springer), Rupert Murdoch, John Kluge (Metromedia), 
George Gallup, and Peter Dailey, then the U.S. ambassador 
to Ireland. The specific, stated purpose of this meeting was 
to deal with support for administration initiatives regarding 
European security and arms-reduction issues — hence the 
heavy European composition of the meetings . Archer Daniels 
Midland chairman Dwayne Andreas and David Rockefeller 
were described as already being "on board." 

24 October 1996 

EIR Special Report 

Raymond also submitted to National Security Adviser 
Clark a set of "talking points" for the President to use at the 
March 21 meeting. The talking points draft stresses the need to 
meet the Soviet challenge in Europe: "The Soviets — through 
their campaign of disinformation and propaganda — seek to 
convince the peoples of Western Europe that friendship with 
the United States increases rather than reduces the threat to 
their security." The document, presumably drafted by Ray- 
mond's office, says that the Soviets "are fighting on the ideo- 
logical battlefields of Europe," and, "We must counter our 
adversaries." The next point recalls Reagan's speech to the 
British Parliament in June 1 982, proposing to build the "infra- 
structure of democracy" with a combined government and 
private sector effort. 

Other priorities 

During the weeks following the March 21 donors' meet- 
ing, Raymond reported that Godson and Cherne had a number 
of follow-up meetings with the "private donors' " executive 
committee. Meanwhile, Raymond also turned to the second 
major focus of the Public Diplomacy project, which was Cen- 
tral America — i.e., support for the Contras. 

A third, major focus of Public Diplomacy was Afghani- 
stan, an area which intersected the Afghanistan Relief Com- 
mittee of John Train and Leo Cherne. In 1985, Raymond 
initiated the creation of the Afghan Media Resource Center 
at Boston University, under the direction of the Dean of the 
School of Journalism, Joachim Maitre — a participant in the 
original March 21, 1983 donors' meeting. This became an 
item of great controversy at Boston University, and in Paki- 
stan, in 1987. The NSC-U.S. Information Agency Public Di- 
plomacy offices had frequent dealings with Train's ARC, ac- 
cording to USIA documents. 

Another focus was Africa, in particular, support for the 
CIA-supported "freedom fighters" in Angola around Jonas 
Savimbi. In a number of memoranda written in May 1985, 
Raymond expressed his hope that a "Freedom Fighters Inter- 
national" movement could be formed, which would include 

C. The 'Train salon' 

No later than April 23, 1983, the first meeting of the na- 
scent "Get LaRouche" task force was held at John Train's 
Manhattan townhouse. This group of government officials, 
private journalists, financiers, and others became the coordi- 
nating center for the news media propaganda and slander 
campaign against Lyndon LaRouche. Known attendees or 
participants included: 

• Richard Mellon Scaife, primary funder of Public Diplo- 
macy, and of the Heritage Foundation; currently a major fi- 
nancial backer of anti-Clinton articles and tracts. 

• Roy Godson, consultant to: NSC (Public Diplomacy), 
the President's Foreign Intelligence Advisory Board 
(PFIAB), CIA Director William Casey, and the U.S. Informa- 
tion Agency and its Director Charles Z. Wick; expert on "So- 
viet disinformation" and "active measures"; and longtime spy 
and informant against LaRouche. Godson' s National Strategy 
Information Center (NSIC) is funded by the Richard Mellon 
Scaife and by the Smith-Richardson Foundation, among oth- 
ers; Prescott Bush is on the NSIC board. 

• Mira Lansky Boland, ADL Fact-Finding Division, for- 
mer DOD and CIA employee; worked closely with federal 
and state prosecutors against LaRouche and associates; she 
was later forced to testify about her attendance at the Train 
meetings in one of the Virginia LaRouche cases. 

• Leonard Sussman, executive director of Freedom 
House; member of the national board of directors of the ADL; 
Public Diplomacy activist. 

• Pat Lynch, NBC-TV producer; helped recruit govern- 
ment witnesses for prosecution against LaRouche. 

• Sol Sanders, former editor of Business Week. 

• Virginia Armat, former editor of Reader 's Digest, per- 
sonal editor to John Train. 

• Dennis King, author of numerous articles and a book 
attacking Lyndon LaRouche. 

• Michael Hudson, former consultant to Chase Manhat- 




Dennis King, at the Alexandria, Virginia federal courthouse for 
the sentencing of Lyndon LaRouche, Loudoun Times-Mirror 
photographer Douglas Graham (left). King was the hack-writer 
for the Anti-Defamation League who penned some of the most 
vicious fabrications against Lyndon LaRouche, on behalf of the 
"Train salon. " 

was twofold: 1) to break LaRouche's channels to the Reagan 
White House, and U.S. military and intelligence circles; and 
2) to lay the groundwork for the prosecution and imprison- 
ment, if not the assassination, of LaRouche. 

The timing of the April 23, 1983, session of the Train 
salon is significant. On March 23, two days after the Public 
Diplomacy private donors' meeting described above, Presi- 
dentReagan stunned the world — and much of his own admin- 
istration — by announcing the Strategic Defense Initiative, a 
global ballistic missile defense system based on new physical 
principles, which would make offensive nuclear weapons ob- 
solete. The President's speech was the subject of an intensive 
battle within the White House, up to the last minute. The final 
version, with its offer of cooperation to the Soviet Union, 
and its rejection of the Kissingerian doctrine of "Mutual and 
Assured Destruction," signified that LaRouche's 1982 pro- 
posal had won out over the "High Frontier" school of Gen. 
Danny Graham and others who wanted a ballistic missile 
defense system limited to off-the-shelf technology, and abso- 
lutely without the offer of cooperation with the Soviets. 

The Soviets quickly came to blame LaRouche for 
Reagan's SDI proposal. 

The President' s adoption of many features of LaRouche' s 
proposal added urgency to a project against LaRouche which 
was already under way in 1982, particularly at the instigation 
of Henry Kissinger. 

'Get LaRouche' 

In August 1982, Kissinger wrote a personal note to FBI 
Director William Webster referencing LaRouche, followed 
up by a more formal letter from Kissinger's lawyer to Web- 
ster, asking the FBI to look into the LaRouche group. This 
was followed up by a much longer letter to Webster from 
Kissinger, dated Nov. 25, 1982, which demanded that the 
FBI take action against LaRouche. Kissinger argued that the 
LaRouche group may be a "disinformation campaign sup- 
ported by some foreign intelligence service." Kissinger's let- 
ter was forwarded to Assistant FBI Director Oliver "Buck" 

Meanwhile, a memorandum captioned "Lyndon 
LaRouche and the Executive Intelligence Review," drafted 
by the FBI head of counterintelligence, James E. Nolan, was 
being circulated. This memo, dated Sept. 24, 1982, stated that 
many of the activities of the LaRouche organization and the 
EIR "are often propitious to Soviet disinformation and propa- 
ganda interests." This was precisely the line being put out by 
Roy Godson and others in his circle. In a 1981 publication of 
Godson's NSIC, EIR was discussed in a chapter on "Soviet 
Covert Action." 

At a Jan. 12, 1983, meeting of the President's Foreign 
Intelligence Advisery Board — of which Leo Cherne was the 
vice chairman, and Roy Godson a consultant — the issue of 
LaRouche was raised. (PFIAB is a White House agency estab- 
lished under Executive Order 1233 1 .) David Abshire, a close 
associate of Kissinger, asked if there was any basis for investi- 
gating the activities of LaRouche's organization "under the 
guidelines or otherwise." The next day, FBI Director Webster 
asked Buck Revell for an update on LaRouche. Revell asked 
the FBI Intelligence Division for areport, which was provided 
to Revell on Feb. 1. The memo to Revell described 
LaRouche's views as the type which are normally associated 
"with the extreme 'right wing' of the political spectrum." It 
lifted sections directly from the Sept. 24, 1982 FBI memoran- 
dum described above, saying: 

While many of the statements and policy positions of 
LaRouche's organizations dovetail nicely with Soviet 
propaganda and disinformation objectives, we have no 
firm evidence that they are being inspired, directed 
or funded by the Soviet Union or others foreign 
groups. . . . 

In addition to its many publications, the LaRouche 
organization sponsors numerous seminars, conducts re- 
search and consulting services, and operates an expen- 
sive communications center. This has led critics to 
speculate that there is a secret source of funds behind 
LaRouche. We have no information to support this 
speculation, although it cannot be entirely discounted. 

Out of the January 1983 PFIAB inquiry, two courses of 
action clearly emerged. One was a secret FBI investigation 

26 October 1996 

EIR Special Report 


and countermeasures under the provisions of Executive Order 
12333. The second was the program of "private" countermea- 
sures and black propaganda organized out of the Train salon 
meetings. The reader should recall that this was precisely the 
period in which Raymond and Godson were putting together 
the Public Diplomacy operation, and writing "talking points" 
for President Reagan about the need to counteract what they 
called Soviet "disinformation and propaganda." 

It is thus of note that, according to one participant, Train 
insisted that LaRouche and his organization be characterized 
as "KGB," and that any indications of contacts between 
LaRouche and CIA officials be ignored. 

The fight in the NSC 

During the early years of the Reagan administration and 
the tenure of William Clark as national security adviser, 
LaRouche and his associates had numerous contacts and 
meetings with administration officials, including many in the 
NSC. One official with whom a number of such meetings 
took place was Richard Morris, Clark's executive assistant. 
Meetings with Morris and other NSC officials occurred in 
1982 and 1983 on an almost weekly basis, and included dis- 
cussions about anti-ballistic missile defense, Soviet relations, 
economics, the Contra issue, the national debt, bank indebted- 
ness of countries in Central America, and South Africa. 

(Years later, in 1988 and 1990, Morris was called as a de- 
fense witness in the trials of LaRouche and associates of 
LaRouche. Morris testified as to the existence of a vociferous 
opposition group within the NSC staff which opposed anyone 
having meetings with LaRouche and his associates. Morris 
testified that the most vocal opponents of LaRouche in the NS C 
staff were Walter Raymond, Kenneth DeGraffenreid, and Roy 
Godson. Morris characterized Godson as the most persistent 
critic, and testified that Godson had characterized Lyndon 
LaRouche as "as a socialist, as a communist, as a member of 
the KGB, as a fascist, and always he was an extremist.") 

As a direct outgrowth of the Train salon meetings, in 
the following months, NBC-TV, the New Republic, the Wall 

Walter Raymond's Public Diplomacy operation. 

King' s list of acknowledgments is a virtual "Who's Who" 
of the Train salon. The list includes NBC-TV's Pat Lynch, 
who "first cracked the story of LaRouche' s White House con- 
nection"; the blue-blood Wall Street law firm of Cravath, 
Swaine and Moore; and, of course, John Train himself — the 
only time the Wall Street spook has allowed his name to be 
publicly cited in connection with the "Get LaRouche" cam- 
paign. 2 


The Train salon, in 
the legal record 

Following are pertinent excerpts from the motion for a new 
trial filed by attorneys for Lyndon LaRouche, William Wertz, 
and Edward Spannaus in federal court on Jan. 22, 1992. The 
sections below describe the operations of the Train salon and 
related matters. The motion was accompanied by six volumes 
of evidence, which are now on file with the U.S. Court of 
Appeals for the Fourth Circuit in Richmond, Virginia. Foot- 
notes and citations have been omitted from the excerpts 
printed below. 


Alexandria Division 


Case No. 

Executive Order 12333, or Otherwise, 

* * * 

64. Through pre-trial discovery and Classified Informa- 
tion Procedures Act (CIPA) procedures (see, e.g., Appendix 
30, Request Nos. 42-44, 49-57, 76 and 79; Appendix 50, pp. 
1 -2), the defense sought proof of covert actions that had been 
conducted against them under the authority of Executive Or- 
der 12333, or otherwise. The Government never acknowl- 
edged any such actions nor provided any relevant discovery 
in this regard. The Government repeatedly ridiculed the de- 
fense for claiming such materials existed. Only after the trial 
and wrongful imprisonment did evidence emerge establishing 
the existence of actions against petitioners under Executive 

Order 12333. 

* * * 

68. The concealed evidence, in addition to the evidence 
otherwise set forth in paragraphs 48 through 63, identifies 
the ADL [Anti-Defamation League of B'nai B'rith], NBC, 
various journalists and others within and without the Govern- 
ment, as having engaged in successive assaults on LaRouche 
and his political movement, its financial base, policy initia- 
tives, and influence with the goal of jailing LaRouche and 
other members, and destroying petitioners' political 


* * * 

71. On May 24, 1990, Mira Boland, Washington, D.C. 
director of the Fact-Finding Division of the ADL, testified in 
Welsh [Commonwealth of Virginia v. Welsh] that she was 
present on behalf of the ADL at a meeting of New York 
financier John Train in New York City in 1984. Boland testi- 
fied that Roy Godson, Dennis King, and NBC's Patricia 
Lynch were also present at that meeting. 

72. Prior to the Boland testimony, petitioners had known 
of one meeting at Train's residence in 1983, which was called 
by Train to gather journalists to "coordinate national maga- 
zine pieces" and work with the Government to "deny you 
[petitioners] funding and tax exemption," but petitioners had 
been unsuccessful, for the most part, in discovering who was 
at the meeting or the degree of government participation in 
the defamation campaign subsequently conducted by the 
meeting's participants. 

73. Following Boland' s revelations in Welsh, subsequent 
investigations revealed that, in addition to Roy Godson, other 
individuals introduced as "gentlemen with a government con- 
nection" participated in meetings at Train's residence, plan- 
ning counteractions against LaRouche; that at least three such 
meetings occurred in 1983 and 1984; that actions of the now- 
identified Train meeting participants continued through 1 987; 
and that now-identified participants in the meeting had en- 
gaged in the past, and were engaging at that time, in govern- 
ment-directed propaganda efforts. 

74. Roy Godson, at the time of the Train meetings, was a 
consultant to the National Security Council (NSC), perform- 
ing classified work for CIA Director William Casey, a consul- 

tant to the President's Foreign Intelligence Advisory Board 
(PFIAB), a contractor of the U.S. Information Agency, and 
also serving in other government capacities. 

75. Godson and another now-identified Train meeting 
participant, Richard Mellon Scaife, were instrumental in ob- 
taining private funding for propaganda activities undertaken 
by the National Security Council under the direction of Walter 
Raymond, pursuant to Executive Order 12333, in support of 
the NSC's foreign policy goals. These propaganda activities 
included disinformation activities conducted against oppo- 
nents of those policies. Participants in the NSC's propaganda 
campaigns included the ADL, John Rees, and other now- 
identified participants in the Train meetings. Dennis King, 
whose actions against LaRouche during the time period of 
the conspiracy were central to both the government' s "investi- 
gation" and the defamation campaign, received funding for 
these activities from the Smith-Richardson Foundation. This 
funding was arranged at a Train meeting attended by Godson 
and other government officials. 

76. Richard Morris, Executive Assistant to former Reagan 
National Security Adviser William Clark, testified in Welsh 
that LaRouche and his associates met repeatedly with Na- 
tional Security Council staff to discuss policy concerns in 
1982-1983, and that he believed some of the issues surround- 
ing that collaboration were still classified. Morris identified 
Roy Godson, Kenneth DeGraffenreid, and Walter Raymond 
as the sources of efforts to discredit LaRouche and destroy his 
influence, when Morris was at the National Security Council. 

77. Recently published works concerning former head 
of CIA counterintelligence James Jesus Angleton state that 
Angleton was approached by Henry Kissinger during this 
period to investigate "LaRouche and his finances." This in- 
vestigation was characterized as a "vendetta" in the recent 
works about Angleton. Angleton was also in contact with 
NBC-TV reporter Patricia Lynch in her 1984 defamations 
of LaRouche. 

78. John Rees and Eugene Methvin, both authors of defa- 
mations against LaRouche during the time period of the con- 
spiracy and participants in, or collaborators of participants in, 
the Train meeting, also have multiple ties to law enforcement 
and the intelligence community. Rees has participated in in- 
filtration and propaganda operations against his perceived 
political opponents and reports his actions to the FBI. Methvin 
has praised the ADL as the ideal "counterattack" group for 
private disinformation operations conducted in tandem with 
the Government. 

79. The following actions against petitioners from 1984- 
1987 can now be traced to the Train meeting participants, 
functioning in tandem with the Government: 

• A January 1984 New Republic article by Peter Spiro 
calling for the exposure and unmasking of LaRouche 
as an extremist; 

• A January and March 1984 NBC-TV News pieces by 

28 October 1996 

EIR Special Report 


Patricia Lynch scandalizing LaRouche's numerous 
associations with individuals involved in the Reagan 
Administration and the intelligence community, and 
blithely claiming that LaRouche planned to assassi- 
nate former President Jimmy Carter by remote con- 
trol television, ran a violent cult, and engaged in 
questionable fundraising, and calling for an IRS in- 

A November 1984 New Republic article by Dennis 
King and Ronald Radosh "exposing" LaRouche's 
contacts in the Reagan Administration; use by 
LaRouche for possible espionage purposes on behalf 
of a foreign power; and associating LaRouche with 
financial fraud and violence; 
Widespread dissemination of the March 30, 1984 
edition of Information Digest, a publication authored 
by John Rees to law enforcement and intelligence 
community personnel and conservative political or- 
ganizations throughout the United States, including 
Loudoun County, Virginia law enforcement offi- 
cials, characterizing petitioners as a violent cult with 
questionable foreign ties and repeating the NBC- TV 
News "First Camera" allegations; 
A derogatory March 23, 1986 Wall Street Journal 
piece by Ellen Hume and a May 27, 1986 Wall Street 
Journal piece by Patricia Lynch and Dennis King 
containing leaks from the Boston grand jury investi- 
gation and other government investigations, and in- 
terviews with anonymous former NCLC members, 
whom King and Lynch call "defectors" and who be- 
came the government's witnesses in its investiga- 
tions and trials; 

Widespread dissemination commencing in the 
spring of 1986 of an ADL pamphlet entitled "The 
LaRouche Cult: The Politics of Political Extrem- 
ism," containing numerous defamatory leaks from 
law enforcement, and utilized by other journalists as 
part of an ADL campaign to "sink" the LaRouche 

Boston grand jury investigation, and claims that the 
IRS had initiated a national investigation; 

• NBC-TV News broadcasts in March and December 
1986, claiming that LaRouche was associated with 
the assassination of Swedish Prime Minister Olof 
Palme. The December 1986 broadcast featured gov- 
ernment witness Forrest Lee Fick making this claim, 
together with notebook references provided by Bos- 
ton prosecutors allegedly buttressing Fick' s claim; 

• The August 1986 Eugene Methvin Reader's Digest 
defamation, entitled "Lyndon LaRouche's Raid on 

• Numerous additional derogatory articles that were 
published and disseminated and that quoted Train- 
meeting participants as their primary sources; 

• A covert and overt campaign within the Reagan Ad- 
ministration and directed at national leaders and for- 
eign leaders and governments to discredit LaRouche 
and to destroy his policy influence, through false and 
fraudulent allegations concerning alleged Soviet ties 
or control, alleged terrorist and mercenary activities 
in contravention of the neutrality laws, and similar 
defamations. Each of these allegations triggers the 
ability of the Government to utilize classified investi- 
gative techniques under the authority of E.O. 12333, 
including actions designed to "neutralize" the invest- 
igative target. 

The intent and result of the dissemination of these falsehoods 
was to demonize LaRouche to the general public and to gov- 
ernment officials in the United States and abroad, and to de- 
stroy the political and financial prospects of petitioners. 

80. The fabricated assassination allegations continued 
through 1986, 1987, and 1988. In the spring of 1986, both the 
ADL and NBC-TV News featured allegations that persons 
associated with LaRouche were involved in the assassination 
of Swedish Prime Minister Olof Palme. During the Summer 
of 1986, Irwin Suall, Fact-Finding Director of the ADL, trav- 

The Goldsmiths and 
the new 'Murder, Inc.' 

In late 1990, at a European conference of leading ecology 
activists, Edward "Teddy" Goldsmith, according to an eye- 
witness, was asked why his brother, Sir James "Jimmy" Gold- 
smith, was not also in attendance. Teddy replied that Jimmy 
had been planning to be there, but at the last minute, he had 
been called off to Washington by his "close friend" George 
Bush, then the President of the United States. Indeed, the 
Goldsmith brothers have been intimately involved in some of 
the nastiest of the secret intelligence programs, under Bush's 
direction, since the early 1980s, including the Public Diplo- 
macy operation in the United States, and Operation Lock in 
South Africa. 

Jimmy Goldsmith was well-prepared for his participation 
in the Public Diplomacy operation, which was linked to John 
Train: Already, in the late 1970s, Sir Jimmy was spreading 
the line that Lyndon LaRouche's wife, Helga Zepp 
LaRouche, was "KGB ." CIA Counterintelligence chief James 
Jesus Angleton claimed that he had first picked up this disin- 
formation line from Goldsmith. 

Sir James Goldsmith (born Feb. 26, 1933) and Teddy 
Goldsmith (born Jan. 16, 1928) were the sons of Col. Frank 
B. Goldsmith (Order of the British Empire; Territorial Effi- 
ciency Decoration; Member of Parliament, Conservative, for 
Stowmarket, Suffolk) and Marcelle Mouillier. One of the rea- 
sons they are so well-suited for building the British-French 
"Entente Bestiale," is that they had a British father and a 
French mother. 

In 1928, while on the board of the exclusive London hotel 
Claridges, Col. Frank Goldsmith founded Hotels Reunis, a 
company which eventually owned 48 hotels in France. These 
included some of the most important hotels in Paris and Monte 
Carlo. When, in the 1940s, the Nazis were poised to take over 
France, the Goldsmith family left France on the same freighter 
as did Evelyn de Rothschild, their cousin who now heads 
N.M. Rothschild & Sons, Ltd. They ultimately arrived in the 
Bahamas, to which the Duke of Windsor had just been shang- 
haied by the British government and made governor general, 
in order to keep him from further intrigue with Adolf Hitler. 
Colonel Goldsmith and his French wife became part of the 
Duke and Duchess of Windsor's "set." While the family had 
its wartime base in the Bahamas, the boys were kept in St. 
Andrews College, in Ontario, Canada. 

Teddy then attended Magdalen College, Oxford. Jimmy 
never went beyond Eton. Their close friend at the time was 
John Aspinall, a professional gambler with whom Jimmy, 
especially, used to gamble. By unknown means, Aspinall 

Sir James Goldsmith, a British financier and Rothschild cousin, 
who took over Operation Lock in 1990, following the death of Sir 
David Stirling. Pictured here at a Senate hearing on G ATT and the 
world economy. 

launched aposh casino in London. According to a knowledge- 
able former member of the British Secret Intelligence Service, 
Aspinall had ties to Meyer Lansky. He later used some of his 
casino profits to fund Teddy's run for Parliament in 1974 on 
the Ecology Party ticket, and for the European Parliamentary 
elections in 1979. Aspinall also helped fund some of Teddy's 
pocket zoos and game preserves, before Jimmy turned over 
much of his fortune to the Goldsmith Foundation to do the 

A bigger crook than Michael Milken 

Jimmy Goldsmith made most of his multibillion-dollar 
fortune in the United States using the same kinds of leveraged 
buyout, junk bond, and "greenmail" schemes identified with 
Michael Milken, with whom he often worked in tandem. 
Jimmy entered the United States in 1973, with the assistance 
of Wall Street financier and British SIS station chief Arthur 
Ross — who, only a few years later, would become involved 
in political intelligence operations against Lyndon LaRouche. 
In 1 973 , Jimmy bought 5 1 % of the Grand Union supermarket 
chain in the United States through his Cavenham Ltd. com- 
pany, which had a subsidiary in France. Grand Union was 
purchased by Jimmy for only $62 million, with the assistance 
of Ross. 

Ironically, in 1985, before he went to work with his 
brother Teddy almost full-time on ecology schemes, Jimmy 

30 October 1996 

EIR Special Report 



had taken over Crown Zellerbach Corp., an American forest 
products company with vast timber reserves. Jimmy was then 
the sixth-largest exploiter of timber lands in Washington, Ore- 
gon, Louisiana, and Mississippi. He swapped these timber 
holdings for Lord Hanson's gold shares in Newmont Corp. 

Jimmy announced his "retirement" from business in the 
early 1990s, after he and Jacob Rothschild failed in their $20- 
billion-plus attempt at a leveraged buyout of the British Amer- 
ican Tobacco company. 

With his retirement from business, Jimmy started selling 
off his shares of Newmont, such that, as of 1990, his holding 
had dwindled to 17%; international speculator George Soros 
acquired 20%. The other holders in Newmont included an 
associate of Jimmy ' s and Soros' s, Lord Jacob Rothschild, and 
Lee Kai Shing, the narcotics-trafficking "Red Fat Cat" of 
Hongkong who recently retired from the board of the Hong- 
kong Shanghai Bank. (He was replaced there by one of his 
sons, who owns 10%.) Lee Kai Shing is allegedly the piggy- 
banker, through whom Conrad Black's Hollinger Corpora- 
tion was able to afford the purchase of the Telegraph PLC and 
the Jerusalem Post. Jimmy is still an advisory board member 
of Hollinger. 

Jimmy remains on the board of Jacob Rothschild Hold- 
ings, which gives him several significant connections. First, a 
fellow board member is Lord William Rees-Mogg, the former 
editor of the London Times and current publisher of numerous 
newsletters and newspaper columns; Rees-Mogg is the Brit- 
ish SIS point man for the Club of the Isles efforts to destroy 
the U.S. Presidency and President Clinton, through slander 
and innuendo. 

Second, Jacob Rothschild Holdings is the holding com- 
pany for St. James Capital, whose top executives include Nils 
Taube, a longtime partner in crime with Soros and a board 
member of Soros's multibillion-dollar Quantum Fund NV, 
based in the Netherlands Antilles. Jacob Rothschild is the son 
of Lord Victor Rothschild, who had been affiliated with, and 
a protector of, the British "triple agent" network of H.A.R. 
"Kim" Philby et al., and particularly of Anthony Blunt, who 
worked as Surveyor ofthe Queen's pictures. Lord Jacob Roth- 

brother Teddy's Gaia (Earth Mother) "spirituality," which 
Teddy started peddling with his The Blueprint for Survival in 
1972. U Autre Europe helped stir up near-riots during the 
recent elections in France. 

Jimmy has just founded a Referendum Party in the U.K., 
which is calling for a referendum on whether Britain should 
be part of Maastricht; his party is lambasting Prime Minister 
John Major, and helping to bring the corporatist fascist La- 
bour Party of Tony Blair into power. 

Although the Goldsmith brothers appear to be offering 
an alternative by their opposition to Maastricht, the General 
Agreement on Tariffs and Trade, and the North American 
Free Trade Agreement (on ecological, rather than anti-free- 
trade, grounds), they also oppose a "Marshall Plan" approach 
for massive infrastructure-building in eastern Europe, on the 
basis that the people there are too corrupt and stupid. Teddy 
published a book in 1992 arguing against large infrastructure 
projects, on the grounds that they destroy the environment. 

In 1972, Teddy wrote The Blueprint for Survival, which, 
along with the The Triple Revolution, became one ofthe bibles 
of the eco-fascist counterculture. Teddy talked about elimi- 
nating cities in favor of small, "self-sustainable" villages, and 
various other schemes related to what Jimmy later used in his 
L' Autre Europe campaign against Maastricht. Since Jimmy 
went "green" circa 1990, he not only expanded his Goldsmith 
Foundation to finance his and his brother's ecological proj- 
ects, but he has been using ecology arguments for his political 
activities, as in his book Le Piege {The Trap). 

Teddy has been one of the main promoters of the Gaia 
"religions," in order to spread eco-terrorism. According to a 
source at the Gaia Foundation, Jimmy is now one of their 
leading funders. The Gaia Foundation works directly with 
Prince Philip and Charles, Prince of Wales. 

Teddy is publisher and editor of The Ecologist, which is 
influential among the ecological movement. Already in 1983, 
Teddy had devoted the major space in The Ecologist to an 
article entitled "Gaia: An Ancient View of Our Planet." It 
stresses how Gaia will crush in the most brutal manner anyone 
who interferes with nature. 

Chapter 3 

The Olof Palme assassination 
and coverup, revisited 

Swedish Prime Minister Olof Palme may very well have 
signed his own death warrant, when, on Sept. 29, 1985, Swed- 
ish Customs officials raided the Malmo offices of arms broker 
Karl-Erik Schmitz, and seized thousands of pages of docu- 
ments, detailing the activities of a global arms and munitions 
cartel, operating on both sides of the Iron Curtain, that was 
responsible for, among other things, funneling billions of dol- 
lars of war materiel to Iran and Iraq, to the Nicaraguan Con- 
tras, and to terrorist groups all over the globe. 

The raid occurred more than a year before the unraveling 
of the misnomered "Iran-Contra" scandal, at the peak of the 
Reagan-Bush administration's arms-for-hostages dealings 
with the Khomeini regime in Iran, and its violations of the 
Boland amendments, forbidding the administration from 
arming the Nicaraguan Contras. 

And, while the raid on Schmitz' s offices did not grab 
global headlines, as did the Oct. 5, 1996 crash of a Contra 
supply plane over Nicaragua, it nevertheless sent Shockwaves 
throughout the highly insulated world of the "munitions car- 
tel," the inner circles of the George Bush-led White House 
"secret parallel government," and allied western and eastern 
European governments and private financier factions— the 
self-described "Club of the Isles." 

The Malmo raid broke the hermetic seal that had, up until 
that moment, protected a multibillion-dollar underground 
economy, trafficking in weapons, drugs, precious metals, and 
other commodities across the East- West divide. And, while 
Palme was himself a part of that structure, and was personally 
committed to assuring that the Swedish branch of the "explo- 
sives cartel" was not deprived of its share of the action, the raid 
placed Palme in the untenable position of having to square his 
public identity as the chief enforcer of the United Nations' 
arms embargo on the Iran-Iraq War belligerents, with his 
insider role in the global arms bazaar. 

Businessman Karl-Erik Schmitz put it succinctly, in a 
press statement he issued in November 1987: "Everyone has 
kept this secret until the Swedish Customs went in like an 
elephant in a porcelain shop and destroyed it." Olof Palme 
was held personally responsible for that raid, regardless of 
whether it was a willful act on his part, or merely a blunder. 

Perhaps most damning — for Palme, George Bush, Mar- 
garet Thatcher, and the Club of the Isles — the raid turned up 

32 October 1996 

extensive evidence that at least one high-ranking official of 
the East German communist party (SED), Alexander 
Schalck-Golodkowski, was an integral part of the Western 
"munitions cartel," and aprime distributor of weapons to both 
sides in the Iran-Iraq War, and to the U.S. -backed Contra 
forces, battling against one of the Soviet bloc's most strategi- 
cally situated client states, Sandinista Nicaragua. 

Schalck-Golodkowski, known among his SED col- 
leagues as "Big Alex," had been deputy foreign trade minister, 
in the dictatorship of Eric Honecker, since 1967, heading 
a unit called the Department of Commercial Coordination 
(CoCo). Schalck reported personally to Honecker and to the 
Central Committee of the SED. He was a recipient of two of 
the highest awards given by the East German state, the Order 
of Karl Marx (1982) and the Great Star of People's Friend- 
ship (1984). 

At the heart of Schalck' s empire was IMES Import-Export 
GmbH, based at the International Trade Center on Friedrieh- 
strasse in East Berlin. The firm ran the lion's share of East 
Germany's trade with the West, and accounted for over 50% 
of East Germany's hard-currency earnings. 

As the documents seized in the Malmo raid first revealed, 
Schalck' s IMES warehouses near the East German port city 
of Rostock, were a crucial way- station on the underground 
railroad of weapons and explosives, into the Persian Gulf, 
southern Africa, and Central America. 

In a typical transaction, revealed in the documents seized 
at Schmitz' s Scandinavian Commodities AB offices, during 
the Sept. 29, 1985 raid, the Swedish explosives company, 
Bofors-Nobel, would deliver a shipment of military gunpow- 
der, falsely labeled as "industrial chemicals," to the Austrian 
firm Dynamit Nobel Wien GmbH. Often, these shipments 
were handled by a Finnish company, Sevico Oy, which had 
specifically hired a Bofors-Nobel executive, Thorbjorn 
Evardsen, in 1981, to handle these "special deliveries." Once 
the powder arrived in Austria, it would immediately be re- 
exported, across the East German border to Furstenburg, and 
then on to the IMES depot outside of Rostock. For a large fee, 
IMES would then re-label the Swedish gunpowder as an East 
German product, and ship it to Iran. 

In addition to the Rostock route, Bofors-Nobel had, dur- 
ing the 1980s, established other smuggling routes into Iran, 

EIR Special Report 

"^ »j">**3't 

via Singapore, and through other European countries, includ- 
ing Italy and Yugoslavia. Often, the Italy route involved the 
use of phony end-user certificates, showing that the gunpow- 
der was actually destined for African countries. This brings 
us full-circle, back to the Ricci networks in the Seychelles 
Islands and in the Republic of South Africa, with its ties to 
the Italian underworld and the Propaganda-2 (P-2) lodge. 

Karl-Erik Schmitz had first gone into the explosives busi- 
ness as a by-product of his long-standing ties to Iran, in the 
oil business. Schmitz had been involved in oil-for-munitions 
deals involving Iran and South Africa, even prior to his deal- 
ings with Bofors-Nobel. 

Safe to do business again 

The assassination of Olof Palme apparently relieved a 
certain amount of anxiety, over the danger of further un- 
wanted revelations about the activities of the arms and muni- 
tions cartel, and its East German and Soviet "business part- 
ners." The raid on Schmitz' s Malmo offices had come at a 
particularly bad moment, when the Reagan administration 
had formally approved covert arms shipments to Iran, and 
when the activities of the Bush-North apparatus were at 
their zenith. 

On April 28, 1986, two months to the day after the Palme 
killing, two prominent Bush- North operatives, Albert Hakim 
and Tom Clines, traveled to Copenhagen, Denmark, to set up 
a new series of front companies, to manage both the Iranian 
arms deals, and the continued supply of weapons to the Con- 
tras, the Afghan mujahideen, and so on. Clines, a former CIA 
officer who had worked closely with Theodore G. Shackley, 
the CIA's one-time deputy director of operations, and was 
now a major player in the Bush-North "Enterprise" of off- 
shore "private" front companies, had arranged the Scandina- 
via trip, to reactivate a longtime asset, Tom Erik Parlow, a 
Norwegian by birth, who was an expert in shipping sensitive 
cargos of arms and explosives. Parlow and his Danish partner, 
Svend Andersen, ran a string of Copenhagen-based shipping 
companies which chartered small cargo ships to make interna- 

Independent Counsel (the "Walsh Report"), Clines "had de- 
veloped significant contacts with arms dealers in Western 
Europe and behind the Iron Curtain." Clines "oversaw the 
logistics of purchasing weapons from private suppliers in Eu- 
rope and arranging for their delivery to Central America." 

But, the question of the assassination of Olof Palme, and 
the linkage between the East- West arms pipeline and that 
murder, was far afield from Walsh's narrow mandate. 

The decade of deception 

From the very moment that Palme was assassinated, late 
on the evening of Feb. 28, 1986, a vast disinformation cam- 
paign was launched, to obscure whatever viable leads might 
have existed in the early moments of the probe. Palme was 
shot in the back at close range; his wife was also hit, but only 
slightly wounded, and the assailant escaped into the darkness. 
On the night of the killing, security around the prime minister 
and his wife was sparce, purportedly at Palme's request. The 
issue of the security stripping was itself never adequately 
taken up. 

Stockholm's Police Chief Hans Holmer, who was the for- 
mer head of the national police agency, SAPO, immediately 
took charge of the investigation, over the protests of some of 
his former SAPO colleagues, and officials of military intelli- 
gence. As a longtime fixture within the most pro-Moscow 
wing of the Social Democratic Party (SAP) "mafia," Holmer 
was not trusted by many professionals. He proved his critics 
right from the very start of the probe. He exerted dictatorial 
control over the 300-person "Palme Task Force," and re- 
stricted access to the centralized data base of leads to a handful 
of his most trusted political allies. 

This power play, as long as it lasted, gave Holmer the 
opportunity to use the probe as a political weapon for target- 
ting enemies of the Social Democracy, starting with the Euro- 
pean Labor Party (EAP), a lawfully registered Swedish na- 
tional political party, philosophically tied to U.S. Democratic 
Party figure Lyndon LaRouche. Several years before the 
Palme assassination, in his capacity as police chief of Stock- 


me.-.o to Tii,.- r:^z --- s;;aa/ Aat '5tMSi,-ivi 

Q'^^ :-.-*.J6***/ 

BATE: Hay 1, ljd6 

oA6/e j 

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■.:..:_._. : *«&:'*& 

A day or two aijo one of my political otdceti nad <i 
conversation with a very well-anown British ouiLti«s^mdn f 
Tiny Auwldnd . Rowland is the ma d cap cogue wno is CCO of 
Louche, which control? from nines in Africa to 
the Princess Hotel In Berauda. Hia Business is politics — 
especially in Africa -- as well as bunneie. 

Tmy told our man he nad a netting last week in London witr, 
the tol lowing pcopl* : 

1) Ami ran Mir ( pronounced Near), Piiae tUhister -Peres* 
•counter terrorism" adviser. Bob Oakley sees'* lot 
of Nic. 

I 2) Ad nan Khasnoggi , a SaJdi dus inesinan, 

(31 H&nucnen Ctvotbamltr , an Iranian. 

Rowland has played numerous gdrtes wun Khashoggi over tne 
years, H* set up the session. rlir said tne/ want Lonrho, 
which has its own aircraft, to be an umorella company for 
various shipments to Iran for: (1) grain, 12) spare parts, 
and 13) weapons from countries at far away as Cnina. 

Hir and Khashoqql told Rowland tne stufi! would all qo 
tnrougnl.0. -H^lJ uJ'j(- *»jrt"«H/^ i -.^' , tr7l/Fri7'«j -ft- #«/" C**+Trj. 
7 1 * j *w-HM„t a^ Hut U*d*J *> OH i**rV. J 

Kowland will get 7.5* of the total value or the merchandise, 
if he joins up, INtrsaid a nunoei of businessmen are 
playing the gane.) ^ , 

* c • 

Nir told Rowland the arrangement is QK with tne AnerLcans. 
He said; 

-- It has been cleared by the Unit* House, but only four 
people knO* aoout it; 

-- Poindexter Lj the point man; 

— no one at the State oep^rtaent knows about it. 


iVCUlf AtlD si 

row Land also told our guy- 

— he checked with David K.acne. Director General of 

Israel Caoinet (pronounced Kinky) - unot Rowland has 
done a lot- of business with in Africa. Kistcne said 
the scheme is for realj Hit speaks foe tne Israeli 
government, at least 45 long 11 Peres is around; 
Rowland aays Kimcne told ni« privately he finds tbe 
whole thing distasteful. ,— «{f; ( M 

-- Rowland checked iti|wn\. **•'* "tv; who said it is for real 

■»- Rowland is not incl ined lo get involved but, if it is 
our operation, he would reconsider. 

ML* 1 iFllt 

-cm cull ioiii 

■in tats* coiaoiicitJoii Icgjici 


-- 1 /"" 

SUIJrcTt 1CSB ' _ 1 ■ 

Ck.rll. rrlta ullW aa altk • allJ atari laklakt. * 'ak '■■■«•" '* 'I," 
• tatl a.l >IU 11>| InllKi, • ltlll>> iWlnuml. liaj aa!4 » «al tkla 
••«k al(k llr, Ikaahqaal «•« Oksikaaltat. lit •••(•< la ••• Tlai'a c»ap..( 
Loakra t. >[atlJa timixil tec a lalaa .Ola ftaltaa to aall «'«'■• allltail 
•pat. fart, aaa a«>»a«a la Icaa Iroa cwlllii >a tat •••! «« «*-' r "-7tka«»i>^ol 
clilMl Ikal lat| klf M»| Da* LlaKia ••« aaoaal Tltf cacalpla t«t larfa 
acala liaaalara at caak la !■!•■ kaala. tic aall tka ackaaa m ak altk tka 

Icaaa «»a oalf laat aaspla la tka Ihtta Moaaa aace laaoltaa' aa* I aaa tka' 
I ua.AI>Mlu.l~i|ta lataltai aal laafala all akica M'ta lalld M ckaaaalal 
aa> rV H'.-4"i.*,t,, uUlv'ui ilUl«< ••< <o«H aat )»1. lie taall cat Tlaf 

la lot 11. Tlkf ckackaa tkla a<t a Ilk- M-A^aal k. caaltital It. tl>| alaa 

c.llaa micka aka alaa coatlra.a 11. - •^f-'.M 

t tola Ckallla Ikat kkata aaa aklf a akraa al tlatk la Ikla fi tka •■ 
ensiaclllh aaa klfktr llatntt.a* Tl.f lala rt.avr. tkat ka 4laa*t Ilka tk* l.a <la adt aakl ta aat latoliad aalaaa It >■• aa UtrUn a»a»tlaa. I 

toll Ckaillata .dtl.a Via aat Id fat l«loln«. 

■ bit la tka hall la 111 dolaa.? ia caallr c.a'l tlaat lhaaa aok*a. 

asa raon: MJ«f -- Crtl tot USIt --till »i/»)/»t Ullllll 

Ta: milt --croi jmioi Jill otricl / 

— 9K/II 


State Department memorandum reporting on a meeting with Tiny Rowland, in which Rowland said he was meeting with Amiram Nir, 
Adrian Khashoggi, and Manucher Ghorbanifar. Nir wanted Lonrho to handle shipments to Iran, and says that the arrangement has been 
cleared by the White House, but only four people know about it, and that no one at the State Department knows about it. 

The second document is a "PROF" (White House E-mail) message from John Poindexter to Oliver North, in which Poindexter relates a 
"wild story" from Charles H. Price, the U.S. ambassador in London, about the meeting that one of his aides, Bob Frasure, had with Tiny 
Rowland. Poindexter is obviously irritated that Nir is talking too much, and he says: " What the hell is Nir doing ? We really can 't trust 
these sob's." 

North replied to Poindexter that he had briefed Poindexter a month earlier on the transactions, and that Ambassador Price had been 
given a "cover story" to mask the arms-for-hostages deals which North and other U.S. officials were directly involved in. North left the 
next day for London to meet Nir and Ghorbanifar. 

Holmer did not have to search very long for allies in his 
quest to blame the Palme assassination on the EAP. Within 
24 hours of the murder, Soviet Central Committee member, 
and prime "America watcher," Georgi Arbatov, the co- 
founder of the Palme Commission and head of Moscow's 
U.S.A.-Canada Institute, told Swedish reporters, "I do not 
know who killed Palme, but I know all too well who hated 
him. ... I saw demonstrations against him by fascist hooli- 
gans, inflammatory articles, and provocations. Reaction 
loathed Palme." Following Arbatov' s initial remarks, a num- 
ber of Swedish Social Democratic newspapers ran stories 
naming the EAP as being the prime suspect in the Palme 
killing, based on leaks from Holmer' s office. 

On March 12, 1986, Holmer's team arrested 33-year-old 
Viktor Gunnarsson, as a suspect in the Palme murder. Based 

on evidence presented by police, Stockholm Chief Prosecutor 
K.G. Svensson ordered Gunnarsson detained. However, a 
week later, on March 19, over the strenuous protests of 
Holmer, Svensson ordered Gunnarsson released from cus- 
tody. Holmer was so furious that he banned Svensson from 
access to the "Palme Room," the central repository of all of 
the evidence in the murder probe. 

But, based on the Gunnarsson detention, the Swedish, 
American, and other European press went wild, printing false 
accusations that Gunnarsson was a member of the EAP, and 
that the detention of Gunnarsson meant that the EAP track of 
the investigation had struck pay-dirt. By now, the interna- 
tional network of enemies of LaRouche were working over- 
time to stoke the disinformation line that "LaRouche killed 
Palme." Further details of this disinformation effort are pro- 

34 October 1996 

EIR Special Report 

vided later in this chapter, and in an appendix that immedi- 
ately follows. 

By May 1986, Holmer's bungling of the Palme murder 
probe had triggered an avalanche of protests by Swedish po- 
lice and prosecutors. On May 9, 1986, the Swedish daily 
Expressen published a series of statements by leading police 
officials, denouncing Homier. One SAPO official declared: 
"I cannot cooperate with an amateur. Therefore, there is no 
longer any reason for me to talk to the police chief." Referenc- 
ing the Gunnarsson track, which Holmer continued to pur- 
sue — despite the fact that Gunnarsson' s links to the EAP were 
bogus, and despite the fact that Gunnarsson had established 
that he was nowhere near the scene of the Palme murder — 
another top police official involved in the probe declared, 
"The more we dig into the case of the 33-year-old, the more 
our suspicions seem unfounded." It later was revealed that 
the only so-called eyewitness who claimed he had seen Gun- 
narsson near the scene of the murder, had been shown a picture 
of Gunnarsson in advance of the police lineup. In short, the 
witness had been manipulated by someone on Holmer' s team. 

On May 16, 1986, the conflict betweenHolmer and Svens- 
son reached a crisis point. The prosecutor issued a statement, 
documenting that the case against Gunnarsson, as assembled 
by Holmer, was bogus. Svensson itemized six different facets 
of the Gunnarsson probe that had violated standard police 
procedures. He cited at least one more instance, in which 
Holmer's men had attempted to manipulate testimony by 
showing potential witnesses photographs of Gunnarsson, 
prior to his appearing in a police lineup. 

Svensson was so angry that he added a personally signed 
addendum to his office's release, which stated, in part, "The 
suspect [Gunnarsson] could have been removed much earlier 
from the murder investigation, if the leadership group in the 
Palme case . . . had not disrupted and prevented rational work 
from the side of the prosecutor. In my view, the suspect has 
been subject to a grave violation of his rights." 

Nevertheless, by this time, much of the damage had al- 
ready been done, in several respects. First, nearly two months 

counterintelligence officials, was that viable avenues of in- 
vestigation had been ignored, or prematurely shut down, on 
the basis of political considerations. For example, leads had 
surfaced early on, suggesting a possible South African con- 
nection to the Palme assassination, based on statements vol- 
unteered by Swedish citizens, who were privy to the links 
between certain right-wing Swedish activists and the South 
African anti- apartheid spy teams. Other leads had suggested 
that networks of the Kurdish Workers Party (PKK), a narco- 
terrorist group active in Sweden, with strong ties to the Soviet 
KGB, may have been involved. All of these investigative 
tracks were shut down, or never even explored, until years 
after the trail had turned ice cold. 

Moscow knew 

The first really dramatic break in the investigation, ironi- 
cally, came on the eve of the collapse of the Berlin Wall and 
the fall of the Soviet empire, on Aug. 24, 1989. The Swedish 
daily Expressen reported that a special electronic surveillance 
unit of SAPO had bugged the home and office telephones of 
a Soviet diplomat, suspected of being a KGB agent, between 
spring 1985 and 1987. On the night of Olof Palme' s murder, 
several hours before the shooting, the Soviet official had held 
a phone conversation, in which he made reference to Palme's 
imminent death. 

The tape of the conversation had been translated into 
Swedish by a special team of Russian language experts, who 
concluded from their review of the voice intonation and other 
analysis, that "the Soviets had both initiated and carried out 
the murder." A subsequent review by members of the SAPO 
team conducting their own investigation of the Palme murder 
drew a less definitive conclusion. However, they, too, came 
away convinced that the Soviet official who had been bugged 
"at the very least, knew about the fact that Palme was to 
be murdered." 

For reasons that still remain a mystery, SAPO officials 
did not pass the information about the bugging on to the Palme 
investigative unit, or even to the minister of justice, until 

Tokyo in 1 98 1 , Irvine noted that there were always suspicions 
that the Soviets were behind the Palme assassination. Rurarz 
"pointed out that they [the Soviets] had produced a very slick 
film that was shown throughout Europe that put the blame on 
the CIA and the Lyndon LaRouche organization to divert 
attention from their own culpability." 

As we saw in Chapter 1, there were also indications that 
some Western circles had also possibly known, in advance, 
that Palme was about to be eliminated. Francesco Pazienza 
had claimed that P-2 Grand Master Licio Gelli had informed 
Republican National Committee official Philip Guarino that 
the "Swedish tree" would soon be felled, 72 hours before the 
murder of Olof Palme. Whether the Gelli story is accurate or 
not, the close East-West cooperation in the coverup of the 
Palme assassination lends great credence to the idea that 
Palme's murder was a "derivative assassination," approved 
in advance by leading circles in both the East and West. This 
is the only explanation for the intimate collusion between the 
likes of Georgi Arbatov; the John Train salon, working out of 
the Bush-North national security structures in Washington; 
and the Swedish police investigators, nominally charged with 
catching Palme's killers. 

Schalck flies the coop 

Several months after Expressen broke the story about the 
bugging of the KGB resident in Stockholm, Alexander 
Schalck-Golodkowski quietly slipped out of East Germany, 
seeking asylum in the West. After a brief stopover in West 
Berlin on Dec. 6, 1989, Schalck was whisked off to Langley, 
Virginia, where he was taken under the protection of the CIA. 
By this time, George Bush was President of the United States. 

Schalck' s vanishing act was first reported in the West 
German daily Bild Zeitung on Feb. 21, 1990, approximately 
two weeks after Schalck arrived in Langley for "debriefing." 
On Feb. 22, 1990,oneof Schalck' s most important colleagues 
inside the East German intelligence bureaucracy, Markus 
Wolf, fled to Moscow. Schalck' s departure was provoked by 
the storming of one of his major storage facilities at Kavels- 
torf, just outside of Rostock. An angry mob of East German 
citizens, accompanied by television camera crews, had en- 
tered the compound in the early days of December 1989, and 
had gotten hold of some of the most sensitive documents, 
detailing Schalck' s worldwide arms-trafficking operations, 
before they could be destroyed or whisked out of the country 
into friendly hands — in Cuba, Romania, or the Soviet Union. 

On Dec. 5, 1989, as a result of the storming of the Kavels- 
torf compound, the new, post-Communist East German gov- 
ernment had issued an arrest warrant for Schalck, on embez- 
zling and illegal arms-smuggling charges. 

Another Stasi agent steps forward 

Schalck-Golodkowski' s "defection" and Markus Wolfs 
simultaneous flight to Moscow in late 1989-early 1990, put a 
damper, albeit temporary, on serious new revelations about 

the East- West illegal arms trafficking of the Cold War era. As 
you shall read in the next chapter of this report, the number 
of mysterious deaths of prominent figures during the final 
days of the Cold War, was also mounting. 

Efforts by several West German Bundestag (parliament) 
members to pry loose new details about Schalck' s CoCo appa- 
ratus, and Schalck' s relations with his not-so-new "American 
friends," were systematically blocked by the government of 
Chancellor Helmut Kohl. After all, U.S. President Bush was 
ostensibly backing his drive for German reunification, against 
the strong protests of Margaret Thatcher and French President 
Francois Mitterrand, and the opening of the Schalck files 
would only bring down a torrent of scandals on every Western 
leader involved in the secret wars of the 1980s — especially 
on George Bush. 

But, in August 1 992, another important former East Ger- 
man Stasi official "came in from the cold," and he provided 
crucial proof that the East German secret police had been 
working overtime to abet the U.S. "Get LaRouche" operation, 
while subverting the Swedish probe into the death of Olof 

In the Aug. 20-26, 1992 issue of J 'ournalisten, the weekly 
publication of the Swedish Journalists Association, former 
East German Stasi officer Dr. Herbert Brehmer admitted that 
the Stasi was responsible for the disinformation that 
"LaRouche killed Palme." In two subsequent half-hour na- 
tional radio broadcasts in Sweden, aired on Aug. 29 and Sept. 
1 , 1 992, Brehmer elaborated on what he revealed in the article. 

Brehmer wrote that "Department X was assigned the task 
of getting involved in the Swedish police investigation" im- 
mediately after the Palme murder. Department X was the 
Stasi unit in charge of foreign language "active measures," 
including "disinformation." The unit had been devised by 
East Germany's foreign spy chief, Markus Wolf, modeled on 
the Soviet KGB's "Desinformatsia" department. 

"At my desk," Brehmer said, "I drew up the outlines of 
how the EAP theory would be conduited into the Swedish 
police investigation. The plan was to have a national Swedish 
newspaper receive an anonymous telephone tip-off. It was to 
happen already during the week after the murder. ... As an 
alternative, the information would go directly to one of the 
special tip-off phones made available by the police. The con- 
tent would be along the lines that the caller 'knew that the 
EAP had committed the crime.' In addition, he or she had 
'witnessed hectic activity in the EAP headquarters in the 
night.' Nothing was really true, but it sounded well-informed 
and credible." 

Brehmer continued: "There were several advantages to 
specifically targetting the EAP. On the one hand, the lack of 
evidence could be compensated for if the newspaper reporters 
found something that really tied the EAP to the murder itself. 
On the other hand, the planted information would contribute 
to diverting attention from 'surely innocent' groups of the left 
wing. The crime could only have been perpetrated by right- 

36 October 1996 

EIR Special Report 



wing extremists. And that we wanted the police leadership in 
Stockholm to quickly understand." 

In fact, on March 3, 1986, about 72 hours after the Palme 
murder, the Danish newspaper Ekstra Bladet, the Stockholm 
daily Expressen, and the West Berlin paper tageszeitung all 
ran identical formulations, that "sources in the police leader- 
ship revealed they are looking intensively at right-wing ex- 
tremist groups, such as the Swedish neo-Nazis and the so- 
called 'European Labor Party.' " 

The Stasi Department X operation drew upon an extensive 
network of East German agents and agents-of-influence in all 
walks of Swedish life. "For the Palme case alone," Brehmer 
wrote in Journalisten, "Registry Department XII had selected 
89 possible IMs, secret informal collaborators. All of them 
were considered suitable for operations in Sweden. . . . Four 
persons were considered especially well-suited. Two of them 
were IMs residing permanently in Sweden, probably a mar- 
ried couple. Another was IMI/2191/78 with 'very good con- 
nections to state and political circles in Sweden and to leading 
officials of the Social Democratic Party (SAP).' And IMI/ 
1326/79 who had 'close relations to the Swedish embassy in 
the G.D.R. [East Germany].' " 

Brehmer concluded: "But irrespective of whether my op- 
eration underwent changes along the way or even completely 
went overboard, the Stasi in any case achieved its goal. I still 
remember how pleased we were when the 33-year-old [Viktor 
Gunnarsson] was arrested as the murder suspect. His contacts 
with the EAP contributed to causing general disgust for the 
EAP. This was the only thing that counted in March of 1986." 

The Bronfman-Stasi ties 

The deep collusion between the Stasi and the U.S. "Get 
LaRouche" task force was greatly facilitated by other "com- 
mercial" activities that were going on atthe same time. Begin- 
ningin 1986, a leading Anti-Defamation League figure, Edgar 
Bronfman, who was also the president of the World Jewish 
Congress (WJC), began a courtship with the East German 
state. In return for absolving East Germany of any role in the 

of East Germany. 

In subsequent trips to East Berlin, Bronfman met person- 
ally with SED Chairman Eric Honecker and with Central 
Committee member Hermann Axen. In 1989, on the eve of 
the fall of the Berlin Wall, Bronfman received the highest 
civilian medal issued by East Germany. 

Bronfman's, and, by extension, the ADL's, sordid deal- 
ings with the East German communist regime, were first ex- 
posed in the West German Jewish publication Setnit, in 
March- April 1990, in an article by Jacob Dachauer, entitled 
"A Whiskey for the Holocaust." Later, prominent West Ger- 
man Jewish scholar Michael Wolfsohn, an employee of the 
West German Defense Ministry, would undertake a declassi- 
fied study of East German Foreign Ministry archives confis- 
cated after the fall of the Berlin Wall, further cataloguing 
Bronfman's perfidy with the East Germans. 

Although Bronfman's political connections worked 
through the Gysi family, and, eventually, through Honecker 
himself, the commercial aspects of the Seagram' s-East Ger- 
many arrangements would have necessarily worked through 
Schalck's CoCo in East Berlin and Rostock. 

A modest proposal 

Following the Brehmer revelations, up until Sept. 26, 
1996, when South African death squad boss Eugene de Kock 
identified Craig Williamson as the mastermind of the Palme 
assassination, few new leads surfaced about any facet of the 
Palme killing and decade-long coverup. 

The de Kock revelations, however, warrant a careful re- 
view of the entire Palme file, to retrace all previous leads, in 
light of the new "South African" angle. 

One incident that requires special attention is the Jan. 13- 
16, 1986 London meeting between representatives of 
Schalck-Golodkowski's CoCo, and Lonrho boss Tiny Row- 
land. At the time of the meetings, which ostensibly dealt with 
joint British-East German business ventures in Africa, ac- 
cused Palme hit man Anthony White was working for Lonrho 
in the Baira corridor of Mozambique; and White was also a 

/lifa/^tAi* s\T \X7i11i nmpn« rtr\/A A^Iorirt TJir»r»ic T /-*-r»n-*-anr»Vi T"^n ■*-!*-» ex 

Case Studies 

The LaRouche case and 
the Palme assassination 

From the moment of the assassination of Swedish Prime Min- 
ister Olof Palme on Feb. 28, 1986, a coordinated disinforma- 
tion campaign was launched, employing the assets of the John 
Train salon, and segments of Soviet bloc intelligence, to im- 
plicate Lyndon LaRouche and his associates in the crime. 
This campaign was to serve two purposes. First, it created a 
"false trail" that distracted investigators from promising leads 
in the crucial early phase of the Palme investigation, when 
the trail was still warm. Second, this false lead was vital to 
reactivate prosecutorial frame-ups against LaRouche, which 
had collapsed and remained dormant until the Palme assassi- 
nation and the election victory of two LaRouche Democrats 
in Illinois soon thereafter. The fraudulent "LaRouche killed 
Palme" allegation, later revealed to be a Stasi-KGB disinfor- 
mation operation, became a central feature of the propaganda 
surrounding the judicial railroading of LaRouche in the 
United States. 

Within 48 hours of Palme's murder, the worldwide Public 
Diplomacy-linked black propaganda machine began to churn 
out "news" items pointing the finger at LaRouche as the au- 
thor of the assassination. The Soviet press, including Pravda 
and hvestia on March 2, declared that "right-wing circles" 
and "Western circles" were to blame for the deed. Then, 72 
hours later, on March 3, the East German State Security Police 
(Stasi) deployed to "plant false tracks in the hunt for the mur- 
derer," as Stasi officer Herbert Brehmer would reveal to the 
Aug. 20-26, 1992 Journalisten, a weekly magazine published 
by the Swedish Journalists Association. According to 
Brehmer, who worked in the Stasi' s disinformation unit (De- 
partment X), it was their job to proclaim that the crime could 
only have been perpetrated by right-wing extremists. 

LaRouche and his associates had been tagged as "right- 
wing extremists" by the propaganda arms of British intelli- 
gence, such as the Hollinger-owned press, and the FBI, since 
1980. In Europe, LaRouche's collaborators had founded the 
European Labor Party (EAP) in the mid- 1 970s . The EAP was 
a long-standing political opponent of the Socialist Interna- 
tional policies of the Palme government, and thus Stasi officer 
Brehmer found the "EAP made an easy target for Department 
X," Brehmer says, "At my desk, I drew up the outlines of how 
the EAP theory would be conduited into the Swedish police 
investigation. The plan was to have a national Swedish news- 
paper receive an anonymous telephone call. It was to happen 
already during the week after the murder." 

But it didn't take that long. The next day, March 4, 1986, 
Expressen, Sweden's largest-circulation daily, ran two sto- 
ries. One reported that "police sources" say they are looking at 
"right-wing extremists," such as Swedish neo-Nazis and the 
"so-called European Labor Party." Of the EAP, Expressen 
wrote that it is "known for hate propaganda against Olof 
Palme," and is on a list of suspects of the Swedish security 
police (SAPO). Buttressing this (although it didn't name the 
EAP explicitly), the second article, authored by Soviet Central 
Committee member Georgi Arbatov, was titled "Palme Hated 
by Many." The disinformation campaign was under way. 

To aid and abet the dirty propaganda targeting of 
LaRouche, on March 12, Swedish police arrested, as a sus- 
pect, a 32- year-old loner named Viktor Gunnarsson. How did 
he tie into the EAP track? Back in 1984, Gunnarsson was 
one of 1,800 Swedes who signed an electoral petition for 
the national party registration of the EAP. Ah ha! He was 
obviously connected to the EAP, right? Wrong. In fact, Gun- 
narsson never became a party member or a supporter. But that 
didn't matter, as truth was not the object. He had been picked 
up by the police for questioning on the Palme assassination, 
and for the next ten years the media would lie that an EAP 
connection to the murder was still an open question. In 1994, 
Gunnarsson was found dead in a North Carolina forest with 
two bullets in his head. 

NBC-TV picks up the Stasi line 

On March 18, 1986, two LaRouche Democrats won their 
primary election in the state of Illinois. This victory necessi- 
tated the immediate deployment of the U.S. black propaganda 
apparatus to neutralize LaRouche's influence. By nightfall, 
NBC Nightly News was running a segment accusing 
LaRouche of complicity in the Palme murder. The segment 
featured the intelligence asset and arch-enemy of LaRouche, 
Irwin Suall, the national fact-finding director of the Anti- 
Defamation League (ADL) of B'nai B'rith. Suall declared 
that it was "not inconceivable" to him that someone connected 
to LaRouche could have killed Palme. (Two months later the 
ADL issued a 10,000-run special report titled, "The 
LaRouche Political Cult: Packaging Extremism.") The day 
after the March 18 NBC segment aired, Hans Holmer, Swe- 
den's police chief heading the Palme murder investigation, 
announced at a press conference that the circumstantial link 
on which the police were holding Gunnarsson, had not panned 
out, and Gunnarsson was being released. 

No matter that this "EAP link to the murder" line had 
evaporated: Every creepy-crawly press whore of the Train 
salon came out of the woodwork to pen pieces pointing to 
LaRouche as behind the assassination. On April 7 and 8, fuel- 
ing the flames of this fabrication, NBC-TV aired yet another 
whopper, this time using an FBI and ADL informant, Forrest 
Lee Fick, to say he'd been told by a LaRouche associate of a 
plot to "assassinate Henry Kissinger." By then, the floodgates 
had opened, and from March to November, 20,000 "news" 

38 October 1996 

EIR Special Report 


items appeared in American newspapers defaming and vilify- 
ing LaRouche. In the summer months, Irwin Suall travelled 
to Sweden to look into LaRouche' s operations there. While 
there, he was interviewed by Swedish investigators concern- 
ing the LaRouche movement. Upon his return to the United 
States, Suall said he filed a report with the FBI — a document 
which the FBI says does not exist. The Train salon media 
barrage, containing false allegations of "foreign funding," 
"Soviet ties or control," involvement in assassinations, etc., 
triggered law enforcement intelligence investigations of 
LaRouche and his associates, which utilized classified invest- 
igative techniques under the authority of Executive Order 
12333, including actions designed to "neutralize" the investi- 
gative target. The environment had been set for a hit on 
LaRouche and his associates, and within months, criminal 
indictments were issued. 

Back in January 1986, a federal grand jury in Boston that 
had been investigating LaRouche and his 1984 Presidential 
campaign, expired, returning no indictments. But now, six 
months later, the climate was ripe to re-target LaRouche. In 
June, a second Boston grand jury was convened on LaRouche 
and his political movement, and by early July, a grand jury 
was also opened in Virginia. Then, on Oct. 6, 1986, more than 
400 agents and police from the FBI, U.S. Secret Service, 
Bureau of Alcohol, Tobacco and Firearms, Internal Revenue 
Service, and other agencies, raided the Virginia publishing 
headquarters of three businesses associated with the 
LaRouche movement's publications. Helicopters, an armored 
personnel carrier, and heavy weapons were on hand to quell 
any resistance. The residence where LaRouche and his wife 
were staying, was also surrounded with hyped-up police look- 
ing for a Waco- style shoot-out. The offices were cordoned off 
for the next two days, while four LaRouche associates were 
arrested at gunpoint and hauled off to jail. Over 2 million 
documents and business records were seized in the raid. For 
days, national television and radio reports were filled with 
pictures or descriptions of the armed raid on the "LaRouche 
compound" as it was dubbed, and of the arrests. 

' * V ■*& - 1.1' 

NBC-TV producer Pat Lynch. Lynch was an important figure in 
the "Train salon. " The March 1984 NBC "First Camera" 
broadcast, which she produced, was the first prominent slander of 
LaRouche generated by the Train group. It featured fabricated 
charges that LaRouche plotted the assassinations of Carter 
administration officials, a forerunner of the later disinformation 
that "LaRouche killed Palme. " 

D . C . This individual, apparently , made no contact with either. 
Yet, 1 1 days later, on Oct. 3 1 , this consular official was inex- 
plicably provided access to evidence seized in the Oct. 6 raid, 
including notebooks of various EIR journalists which were 
part of the evidentiary material the U.S. government intended 
to use in its criminal case against the associates of LaRouche. 
EIR journalists who covered security counterintelligence 
matters had been following the reports and details of the 
Palme assassination. It was in their notebooks that entries 
about the murder were found. 

rr/-vT mm »v» c\ r\ t- in 1 

it then concludes: 

In order to avoid past complications experienced in 
WASHINGTON, D.C., vis-a-vis using diplomatic or 
law enforcement channels, Boston should use Legat 
London as a conduit for passage of any information/ 
material to Swedish Police rather than through Swedish 
diplomats in the U.S. London will provide Boston 
promptly with any contrary wishes of Swedish authori- 
ties. . . . 

On Nov. 12, another FBI document reported that the 
Swedish consular official had reviewed the copied notebook 
pages and found "no reference to the murder of Palme . . . 
earlier than the first week of March 1986," and he "saw noth- 
ing in [them] which could qualify as a 'smoking gun.' " 

But on Nov. 24, NBC-TV producer Pat Lynch called 
EIR's Washington, D.C. office demanding to speak with 
someone about Olof Palme by 5 p.m. that day. When EIR 
returned Lynch' s call, she stated that she had heard that there 
were "many mentions of the Olof Palme murder in note- 
books" that were seized during the Oct. 6 raid. The Boston 
LaRouche case prosecutor also got a call from Lynch about 
this time. Ten days later, on Dec. 4, NBC Nightly News said 
that it had received information that American law enforce- 
ment agencies had new evidence on who killed Palme. It 
reported, "When federal agents raided LaRouche 's Virginia 
headquarters last month, they found notebooks written after 
Palme' s death by several key LaRouche aides. According to 
sources close to the investigation, the books contained 45 
references to Gunnarsson, the Palme assassination, and the 
use of a .357 magnum in the murder. The Swedish authorities 
are now examining the notebooks. . . ." 

Whether the prosecutor or the Swedish diplomat leaked 
the notebook story to Lynch, is not known, because neither 
the FBI or the Justice Department will release documents 
which account for this highly improper, if not illegal, collu- 
sion between the government, the media, and a questionable 
diplomatic channel. 

Within 24 hours, the Train black propaganda apparatus 
was in high-gear again. The AP and UPI wire services, the 
New York Times, and the Washington Post all put out stories 
that federal authorities were examining notebooks seized in a 
raid on the headquarters of "political extremist Lyndon 
LaRouche." The notebook story triggered a request from In- 
terpol in Stockholm "to review the documentary evidence 
seized" in the raid on the LaRouche headquarters. But, a Dec. 
5 LTPI wire story reported that Swedish police were asked 
about the NBC TV report, and while they would not confirm 
or deny whether they were reviewing the notebook entries, 
police spokesman Leif Hallberg said, "There is a dispropor- 
tionately great interest among journalists in the United States 
about one of the leads we have followed up during the investi- 
gation. . . . Every time NBC or some other agency from the 

States calls us about this [LaRouche angle] we look at each 
other at police headquarters and say, 'Oh no, not again.' " 

The Cini Foundation 

Shortly after the first anniversary of the Palme assassina- 
tion, in March 1987, the elite oligarchical Cini Foundation 
met in Venice. During their discussion of international terror- 
ism, "the name of LaRouche came up in the context of discuss- 
ing Palme," one participant later told a journalist. John Train 
had been married to Maria Cini, whose mother was a member 
of the so-called "disenfranchised" Swedish nobility. Weeks 
after this meeting, Swedish authorities requested permission 
from the U.S. Justice Department to send three investigators 
to conduct 15 interviews of U.S. persons, including two for- 
mer LaRouche associates who had been members of the EAP, 
and who had been extensively questioned a year earlier. De- 
spite the fact that, back in November 1986, a Swedish official 
had found no "smoking gun" in the LaRouche associates' 
notebooks, the EAP investigative track had been re-opened, 
probably thanks to Train's propaganda apparatus. 

In February and March 1987, two new rounds of indict- 
ments and arrests against 28 LaRouche associates occurred, 
this time by state authorities in Virginia and New York. It 
would be revealed in FBI documents released years later, that 
the state prosecutions were highly coordinated with federal 
authorities, and an FBI document even declared that the Vir- 
ginia state prosecution was "politically motivated." The pil- 
ing on of these prosecutions had one clear purpose: to destroy 
and dismantle the LaRouche political movement. 

An unprecented seizure 

In a dawn raid on April 21, 1987, U.S. Marshals seized 
bank accounts and offices, and padlocked the doors of three 
companies associated with the LaRouche movement. The 
companies were never reopened. (This shutdown was later 
ruled to have been illegal, but by then the companies were 
long dead.) The afternoon before, U.S. Attorney Henry Hud- 
son, who was heading the "Get LaRouche" task force in Vir- 
ginia, filed involuntary bankruptcy petitions against the com- 
panies, and motions to permit an immediate seizure. At an 
unrecorded, ex parte hearing before a federal bankruptcy 
judge, Hudson requested absolute secrecy around seizing the 
offices. A confidential source later told EIR that the judge had 
been told that "the LaRouche people are terrorists," as ameans 
to ensure he would grant the government' s secret request for 
this unprecedented seizure. 

(This involuntary bankruptcy seizure laid the basis, a year 
and a half later, on Oct. 14, 1988, for yet another round of 
indictments. This time, in Alexandria, Virginia, LaRouche 
and six associates, were charged with a federal loan fraud 
conspiracy. The charge was that the solicitation of loans for 
these three companies was done "without any intention to 
repay," and thus, that it was a fraud. The government arbi- 
trarily ended the time- frame of the alleged conspiracy on the 

40 October 1996 

EIR Special Report 



day before it seized the three firms. In truth, it was the seizure 
of the firms which ended any possibility of loan repayment. 
But, nevertheless, the LaRouche defendants would be tried 
and convicted on these charges — without even being allowed 
to tell the jury about the bankruptcy shutdown. FBI docu- 
ments obtained in 1993 show that the search for witnesses for 
the criminal prosecution did not begin until the day of the 
bankruptcy seizure. In an effort to create prosecution wit- 
nesses, FBI agents began a nationwide dragnet, visiting lend- 
ers to the firms, and telling them that because of the bank- 
ruptcy, they would never get repaid.) 

It just so happened that the day of the seizure was the same 
day that Swedish investigators arrived in the United States. 
Press headlines the next day reported the new government 
raid on the LaRouche movement, and, because of a Justice 
Department or FBI leak, also reported that Swedish police 
officials were in the United States to take another look at 
whether LaRouche and his associates had been involved in the 
Palme murder. These "news" items were quickly re-broadcast 
throughout Europe. 

Through key Train salon figures, including Pat Lynch, 
and with financial support of tax-exempt foundations impli- 
cated in the Iran-Contra "secret government," such as the 
Smith-Richardson and the Mellon-Scaife foundations, Train 
oversaw the recruiting and "aversive conditioning" of "in- 
sider" witnesses who would appear in every LaRouche-linked 
trial. When Swedish officials met with the Boston prosecutor 
in April 1987, the prosecutor not only made 4,000 pages of 
documents available to them, but he arranged for one of them 
to travel to New York to meet a "confidential source." The 
"source" was a former LaRouche associate, or what the gov- 
ernment called an "insider," who admitted he had "no direct 
knowledge concerning" the Palme assassination, but that it 
was his opinion that "if LaRouche wanted . . . Palme assassi- 
nated he would have" the EAP "do it." 

By August, the Swedish daily Aftonbladet reported that 
since the Swedish authorities' recent trip to the United States, 
they now say the EAP investigative track can be dismissed. 

organizations and individuals, to plant defamatory news arti- 
cles and conduct financial warfare against LaRouche and his 
political supporters. In Boston, the government's response 
was to ridicule the discovery demand as an "Orwellian fan- 
tasy," and in Alexandria the prosecutors denied such evidence 
existed, but if it did, they claimed it would be "irrelevant." 
Another motion requested any evidence in the government' s 
possession showing that it colluded with the ADL and NBC- 
TV in promulgating the lie that LaRouche was implicated 
in the assassination of Palme. In response, the government 
denied any such evidence existed. Yet, as seen above, the 
December 1986 "notebook" story, designed to implicate 
LaRouche associates in the Palme murder, shows that such 
collusion did occur. 

The trial of the first LaRouche case began in December 
1987 in Boston. Despite the government's ridicule andefforts 
to exclude from the courtroom the truth about this "secret 
governmenf'-coordinated "Get LaRouche" operation, the de- 
fendants continued to press the issue. Three months into the 
trial, on March 4, 1988, the case blew open when the prosecu- 
tor disclosed that a document had been found in "Oliver 
North's safe, from Richard Secord, concerning information- 
gathering against Lyndon LaRouche." With that disclosure, 
the first light was shone on the secret government' s role in 
the frame-up of LaRouche. After three days of procedural 
wrangling, the Secord-to-North document was declassified, 
and it revealed that an information-gathering infiltration oper- 
ation against LaRouche had been sanctioned. 

The LaRouche defendants had contended that their trial 
was a political prosecution dictated by the intelligence com- 
munity under the terms of E.0. 12333, and this secret commu- 
nique between Secord and North now confirmed it. North and 
Secord were at the heart of the secret arms shipments to both 
Iran and to Central America, operations conducted under the 
supervision of George Bush. On March 10, after a second 
classified document — also relevant to the defendants' earlier 
discovery requests — was disclosed, the judge ordered that 
White House files, including those of Vice President Bush, 

U„J C J, 

. — 1~+~J , 

The Club of the Isles 
and the international 
weapons cartel 

In June 1985, acting on a tip, Swedish Customs officers raided 
the offices of a Malmo, Sweden export business, Scandina- 
vian Commodities, owned by Karl-Erik Schmitz. In the raid, 
authorities seized thousands of pages of international ship- 
ping documents related to allegations of illegal arms and ex- 
plosives trade involving Iran, which was then in the midst of 
a five-year-long war with Iraq. 

In an angry press statement in November 1987, Schmitz 
blurted out something extremely revealing — something all 
but ignored by the international media and weapons trade 
investigators: "Everyone has kept this secret until the Swedish 
Customs went like an elephant in a porcelain shop and de- 
stroyed it. Everywhere you go, it is the Swedish material that 
is the basis for investigation," he said. 

On April 26, 1989, Schmitz gave further hints to the exis- 
tence of a vast, secret, illegal, and "above government" inter- 
national explosives and arms cartel, a secret, parallel govern- 
ment, as some U.S. Senate investigators referred to it at the 
time. In an interview with EIR's William Engdahl, Schmitz 
admitted, "This is a well-established and international arms 
trading system that has been in place and operating for de- 

He described its workings: "You have what are called 
'red' countries, and what are called 'green' countries. If you 
are forbidden by law to export to a 'red' country, it is well 
established that you simply go to a 'green' or legal country to 
export. They then reship the material to the 'red' country. 
This is well established. And in my case, it was all done with 
the knowledge of the authorities. The Swedish authorities 
allowed this with the complete knowledge that they were 
ultimately destined for Iran." 

The raid on the offices of Scandinavian Commodities pro- 
duced a wealth of documents, which revealed the existence 
of a European cartel for the coordinated pricing and market 
share of the worldwide market for military explosives and 
ammunition. This so-called explosives cartel, as it has come 
to be termed, is but the visible side of a major geopolitical 
apparatus which evolved during the Cold War era. By the 
1980s, this cartel determined where major wars or conflicts 
would exist, where not; which side might win, which not. 
Given the presence of enormous raw materials and oil depos- 
its in many of the war zones, the power of this explosives 
cartel and its related affiliates is staggering. 

The era of controlled East-West conflicts 

In the aftermath of the 1 962 Cuba "missile crisis" between 
Nikita Khrushchov's Soviet Union and the John Kennedy 
administration in the United States, a new phase in global 
Cold War politics began, best typified by the back-channel 
Pugwash Conference on Science and World Affairs, headed 
by recent Nobel Peace Prize winner Josef Rotblat. In these 
annual conferences, East met West to carve out regions of 
conflict which, as mutually agreed, would not threaten the 
vital interests of either the West or the East or escalate into 
possible superpower thermonuclear confrontation. 

The disastrous Vietnam War, which finally ended in 1 973 , 
after a decade of slaughter and destruction, had been con- 
ducted as a direct confrontation between the United States 
and Communist North Vietnam. The humiliating defeat suf- 
fered by the United States dictated that such direct wars were 
no longer desirable. 

Following the 1979 Soviet invasion of Afghanistan, the 
East-West "zones of conflict" went through a significant 
phase change. During the 1980s, until the collapse of the 
Soviet Union in late 1989, a huge increase in arms exports 
from Western countries, notably West European countries, 
fuelled grotesque new, or vastly expanded, wars. 

The primary areas of warfare were South Asia, including 
Afghanistan, as well as the always-simmering potential for 
India-Pakistan conflict, and southern Africa, which included 
a multitude of wars between the black front-line states sur- 
rounding the white-run apartheid regime of South Africa, as 
well as so-called "civil wars" in Angola, Mozambique, Sudan, 
and elsewhere. Central America, including Guatemala, El 
Salvador, and Nicaragua, became another zone of conflict. 
But, by far the most significant, in terms of dead and wounded, 
was the Iran-Iraq War ( 1 980-89), the largest conventional war 
since the Korean War of the 1950s, between two of the largest 
oil-producing nations in the world, situated in the region with 
the vast majority of the world' s known petroleum reserves. 

All these Cold War-era "conflicts," as they were euphe- 
mistically called, had several things in common: They took 
place in nations or regions of the Third World. They had the 
consequence of destroying any prospects for healthy national 
economic development in these regions. They provided an 
almost unlimited market for export of costly explosives, am- 
munition, and sophisticated weapons produced by the West. 
And, most convenient for the Western arms suppliers, they 
rarely came to an end. 

A very powerful club 

What is not known about these wars of the past two de- 
cades, is the fact that they formed an integral part of the post- 
war geopolitical policy of Sir Halford Mackinder and the 
British-centered elite grouping, which privately calls itself 
"The Club of the Isles." This private power, the Club of the 
Isles, is in most respects more powerful than most major na- 
tions because of its supranational organization and its com- 

42 October 1996 

EIR Special Report 


mand over the capital flows of the City of London and much 
of Continental European banking, from Switzerland to Hol- 
land: It is the heart of the "secret parallel government," re- 
ferred to in the Iran-Contra hearings. Those hearings never 
touched on the real, supranational nature of that secret govern- 
ment, allowing the investigation to remain on the level of the 
pathetic Col. Oliver North and friends. 

The power of the Club of the Isles has evolved around the 
financial and political powers incorporated in the House of 
Windsor and the British aristocracy, and today includes the 
elite "old families" of most of Europe, from Holland to Swit- 
zerland, from Sweden to Germany, Austria, Italy, and France. 
This oligarchical and highly secret grouping uses institutions 
of various nation-states as suits them, independent of any 
national parliamentary checks or controls — so powerful are 
these families. 

One of the most dangerous and ominous capabilities of 

this Club of the Isles grouping, has been its ability to control 
major parts of the Western supply of military ammunition and 
explosives essential to the conduct of war. This control was 
formally established in the wake of the Yom Kippur War and 
the first oil shock, in 1975 in Paris. 

The cartel, which was set up to create a monopoly in 
Western supply of shells and explosives in 1975, took the 
deliberately misleading name, "European Association for the 
Study of Safety Problems in the Production of Propellant 
Powder." The association also joined the larger European 
chemical industry trade group, SEPIC, with headquarters in 

In a sworn court statement on Feb. 11, 1986, the indicted 
Nobel Industries marketing chief, Mats Lundberg, told Swed- 
ish judges that, aside from "official" safety concerns, the Ex- 
plosives Club was the meeting point at which business deals 
among the major explosives makers were discussed, includ- 

The size of 1980s illicit 
Third World arms market 

It is extremely difficult to obtain accurate data on the extent 
and value of the huge arms sales during the past two de- 
cades to regions of conflict in the Third World. The most 
reliable source for such crude estimates as exist, comes 
from the annual studies of the Stockholm International 
Peace Research Institute (SIPRI). In its 1987 Yearbook, 
SIPRI details the arms trade to that point in the Iran-Iraq 
War, then entering its seventh year. 

In that war, the largest in scale of the decade, SIPRI 
notes, "Initially, the U.S.A. and the U.S.S.R. — the tradi- 
tional major arms suppliers for Iran and Iraq, respec- 
tively — declared neutrality and refused to ship new 

over a share of this hugely profitable business. 

Iran imported well over $10 billion in arms and explo- 
sives in the period, from all available sources, including 
the United States, Israel, and South Africa, in addition to 
the European nations mentioned. SIPRI estimated Israel's 
share in the Iran business at $500 million. All this was 
coordinated, of course, by the same European explosives 
and arms cartel which was supplying Iraq. Illegal U.S. 
sales were farmed out to British intelligence under 
Thatcher, during the period when George Bush, as vice 
president (1981-89), ran White House covert operations. 

British involvement, by all accounts, was vital and 
massive but, characteristically, extremely well hidden, 
through third parties— South African cutouts, and so 
forth — which makes dollar estimates all but impossible. 

According to SIPRI calculations, for 1982-86, the 
United States was the world' s leading weapons exporter 
to the Third World, with an official total of $54.5 billion. 

ing cartel pricing, and division of which member firm sup- 
plied how much of a given shipment. It was here that the 
enormous orders to supply Iran's military with explosives 
were decided during the 1980s. 

The members of this explosives cartel, not surprisingly, 
were the very firms with whom the Swedish businessman 
Schmitz conducted his business on behalf of Swedish cartel 
member Bofors. In addition to Bofors, members of the highly 
secret explosives cartel include PRB of Belgium; Muiden 
Chemie BV of Holland; Dynamit Nobel of Vienna, Austria; 
Imperial Chemicals Industries of the United Kingdom, via its 
subsidiary Nobel Explosives Ltd.; Dynamit Nobel of West 
Germany; Oy Forcit of Finland; and SNPE of France. 

This explosives cartel and, on a higher level, the Club of 
the Isles, determine who wins or loses and, of fundamental 
geopolitical importance, where such wars will be fought. 

According to well-informed investigative reports, this 
"explosives cartel" is at the core of a larger "arms cartel," 
which includes each member country's major producers of 
military hardware, including missiles, mines, tanks, and mili- 
tary vehicles needed in warfare. But through control of the 
sophisticated ammunition and explosives, the cartel is able to 
control the entire process, a point which Iran realized, to its 
alarm, in 1980: Without Western-produced ammunition for 
its Western-bought arms, Iran was defenseless. 

Schalck-Golodkowski and 
'destructive engagement' 

During 1982-89, special elements embedded in the intelli- 
gence organs of NATO and the Warsaw Pact supervised a 
multibillion-dollar "gentlemen's agreement," dividing up the 
munitions shipments to warring Iran and Iraq. One of the 
central figures in this East-West "trust building" exercise of 
oil-weapons-drugs triangular trade, was Alexander Schalck- 
Golodkowski, the head of CommunistEast Germany's Minis- 
try of Foreign Trade Department of Commercial Coordina- 
tion's (CoCo) covert trade and smuggling apparatus. 

Schalck-Golodkowski, the orphaned son of the Polish von 
Golodkowski family, was adopted during the Nazi occupation 
by Cracow-based SS battalion leader Richard Schalk, despite 
his Jewish mother. The young Schalck-Golodkowski, who 
added a "c" to his name to disguise his connection to his 
adoptive father, earned his keep after the war as a bouncer 
and smuggler in East Berlin. It was here that he was recruited 
to a smuggling network brought under the control of the East 
German Ministry for State Security, or Stasi. The smuggling 
brought in hard currency for East Germany's growing, KGB- 
supervised intelligence apparatus, and was Schalck-Golod- 



S 1 




Schalck-Golodkowski, the former head of the East German 
government' s department of Commercial Coordination, was a 
pivotal East bloc figure in the 1980s weapons-smuggling 
apparatus, that fueled conflicts in the Persian Gulf Afghanistan, 
Central America, and Africa, generating billions of dollars in hard 
currency revenues per year. After the fall of the Berlin Wall, 
Schalck escaped to the West. 

kowski's specialty until the demise of East Germany in 1990. 

Schalck-Golodkowski was taken under the wing of the 
Stasi 's Hans Fruck, who was later to become a deputy to 
Markus Wolf, the famed head of Stasi foreign espionage. 
Wolf was associated with the Kim Philby wing of Soviet 
intelligence, which took its cues on surrogate warfare and 
trade from the British Secret Intelligence Service. To this 
combination were added the contacts coming from the 1980' s 
East- West weapons trade, supervised by British Prime Minis- 
ter Margaret Thatcher and U.S. Vice President George Bush, 
the man with his hands on the "secret government" intelli- 
gence apparatus in the United States. 

Thus, Schalck-Golodkowski delivered, through George 
Bush's aide Oliver North, East German-built Kalashnikov 
assault weapons to the Contras, with Monzer al-Kassar, a 
Syrian drugs-for-guns intelligence hand, serving as middle- 
man for many of the deals. 

Deals with Lonrho 

In January 1 986, one month before the assassination of 
Swedish Prime Minister Olof Palme, Schalck-Golodkowski 

44 October 1996 

EIR Special Report 





sent his top aide, Dieter Uhlig, to London for secret meetings 
with Tiny Rowland and the top leadership of the British Lon- 
rho company, to plan out British-East German joint opera- 
tions in southern Africa. In the years prior to this meeting, 
Schalck-Golodkowski had made the arrangements with the 
Swedish side of the European explosives cartel, which permit- 
ted EV1ES Import-Export GmbH, a CoCo creation, to front 
for, and take commissions on, weapons deliveries to Iran, The 
official secret report on the London meeting (discovered after 
unification), demonstrates an astonishing level of cooperation 
between Wolf s underling Schalck-Golodkowski, and the top 
levels of Britain's intelligence apparatus. Attendingthe meet- 
ing were Edward du Cann, an adviser to Thatcher, and A.H. 
Ball, whose father headed Britain's MI-5 from after World 
War II until 1961. 

Uhlig was the number-four man in CoCo; IMES, created 
by CoCo in 1982, primarily to carry on the weapons trade for 
the Iran-Iraq War, was direcdy under Uhlig' s control. At this 
time, East Germany had more than a thousand specialists in 
Angola and Mozambique. The London negotiations estab- 
lished joint approaches to expanding Lonrho's control over 
southern Africa's infrastructure and trade, including the re- 
quired security measures. Simultaneously, the recently ac- 
cused Palme assassins, Craig Williamson and Anthony 
White, were co-directors, along with British agent Michael 
Irwin, of the Longreach security company. White was based 
in Beira, the port city of Lonrho's oil pipeline to Harare, 
Zimbabwe, which delivered, through Mozambique, all of 
Zimbabwe's oil. 

In February 1986, Uhlig was to fly to Mozambique for 
direct on-the-ground coordination with Lonrho. By mid- 
1986, under the umbrella of the Schalck-Golodkowski/Lon- 
rho arrangements, the British company Hall and Watts, made 
up of former Special Air Services (SAS) commandos and 
specializing in defense sales, landed the contract to train an 
elite Mozambique troop, as reported in Jane's Defence 
Weekly on Oct. 25, 1986. The organizer of the deal was the 
head of the Rhodesian SAS, Maj. Graham Wilson. Hall and 

and ran Soviet oil into South Africa as well. Rich's Brooklyn, 
New York, representative, Rabbi Ronald Greenwald, had 
worked with Stasi lawyer Wolfgang Vogel since the late 
1970s on East- West spy swaps. Greenwald also worked with 
Shabtai Kalmanowitch, the KGB agent laundered through the 
Likud wing of Israeli intelligence, who controlled the South 
African bantustan Bophuthatswana. Vogel was also in the 
middle of East Germany's "sale" of dissidents to West Ger- 
many for hard currency. Vogel, Schalck-Golodkowski' s law- 
yer, was arrested in 1989 in possession of suitcases of CoCo 
documents, given to him by Schalck-Golodkowski. 

After the dissolution of East Germany, Schalck-Golod- 
kowski and Uhlig stayed in business, hardly losing a dollar 
from the old East German secret bank accounts in Liechten- 
stein and Switzerland in the process. After the unification 
of Germany in 1990, Uhlig, along with the former general 
director of IMES, Erhard Wiechert, founded an export-import 
firm, Uwimex, as a continued base of operations. Uhlig even 
kept up with "business" in Mozambique. Under Stasi foreign 
espionage head Werner Grossman, CoCo itself was quickly 
privatized before the unification of Germany, becoming the 
Berlin Trade and Finance Company (BHFG), according to 
Das Schalck-Imperium Lebt {The Schalck Empire Lives), by 
Peter-Ferdinand Koch (Piper Verlag, 1992). Who became 
BHFG's business director? Dieter Uhlig! 

BHFG was used to "privatize" CoCo assets for former 
Stasi personnel around the world, out of the reach of the Ger- 
man government. Earlier, in December 1989, Schalck-Golod- 
kowski "defected," enjoying in the West the Bush-Thatcher 
protection which made his previous Stasi-CoCo business pos- 
sible. From his villa in Bavaria, writes the Suddeutsche Zei- 
tung on Oct. 18, 1995, Schalck-Golodkowski headed a 14- 
person trade delegation to China in October 1995. 

EIR detailed 

of thousands of underwater and land mines to Iran." Borletti, 
a close associate of FTAT's Gianni Agnelli, one of Italy's 
leading Club of the Isles figures, ran one of Italy's largest 
defense industries, Valsella, which, in partnership with the 
Swedish Nobel-Bofors, was part of what the French magazine 
L'Evenement du Jeudi had labelled the "European Irangate 

Borletti and the others were arrested two days after Italian 
authorities seized a Lebanese chartered ship, Boustany I, car- 
rying millions of dollars' worth of Soviet- and American- 
made weapons, as well as large quantities of hashish and 
heroin. According to the Investigative Leads story, drawn 
from court records, "documents confiscated during the ar- 
rests, included details of the Borletti-Valsella dealings with 
Iran. Other documents reportedly linked the guns-for-drugs 
transactions to a Syrian trafficker identified as Firaas al-As- 
sad, the nephew of Syrian President Hafez al-Assad, and the 
son of Rifaat al-Assad." In fact, Borletti ' s arms and explosives 
smuggling, according to the Investigative Leads account, had 
been run through a Spanish company, Bovega, run by Mansur 
al-Kassar, a leading Syrian arms- and drug-trafficker, who 
had been George Bush and Oliver North's "second channel" 
to Khomeini in the arms-for-hostages deals, from 1986 

At the time that this new evidence was published in Invest- 
igative Leads, Swedish authorities were still too busy attempt- 
ing to conjure up evidence that "LaRouche killed Palme," to 
seriously probe the actual authorship of the murder — espe- 
cially at the point that the leads were pointing toward the 
European-based munitions cartel and, above that, to the Club 
of the Isles networks, then steering the secret programs of 
Bush and Thatcher. 

The following is the text of the Investigative Leads story. 

Profile: Karl-Erik Schmitz 

Reference Files: 

Schmitz, Karl-Erik; Lundberg, Mats; Winberg, Claes Ul- 
rik; Tirrena Industriale SpA; Scandinavian Commodity AB; 
Gechem SA (PRB): Carlberg, Anders; Serafina SA; HRD 
Holding SA; Muiden Chemie BV; Societe Nationale de Pou- 
drieres et Explosifs SA; Israeli Military Industries; Distraco 
SA; Gourary, Alexandre; Navon, Moshe 

A key figure in the European phase of Irangate is a 52-year- 
old Swedish businessman, Karl-Erik Schmitz, who resides on 
an estate near Malmo. Schmitz has been indicted by Swedish 
authorities under a law that prohibits the export of Swedish 
arms to countries that are at war, Schmitz had done a $200 
million-a-year business off the Iran-Iraq War, using such Eu- 
ropean firms as Nobel Industries Sverige AB, Sweden's big- 
gest arms and explosives maker. Also indicted with Schmitz 
was Nobel official Mats Lundberg. 

The indictments were the result of an investigation by 
Swedish authorities of Nobel and its Bofors arms-making 

subsidiary, which began in May 1985. On Nov. 14, 1985, 
Claes Ulrik Winberg, president of Bofors-Nobel Industries 
Group, was forced to resign as head of the Swedish Employers 
Association. The scandal in Sweden first broke on June 5, 
1985 in Dagens Nyheter, which noted that this was going on 
"while Prime Minister Olof Palme is acting as UN mediator 
in the Iran-Iraq War." 

At this early time, State Secretary Carl-Johan Aaberg of 
the Foreign Ministry was quoted saying that the government 
had investigated a controversial chemical factory under con- 
struction by Bofors-Nobel outside Isfahan, Iran, after Iraq 
protested that the factory was military. Aaberg told Dagens 
Nyheter that the government had concluded it was "civilian." 

On Sept. 8, 1985, Dagens Nyheter reported that the Bo- 
fors-Karlskoga factory had shipped 50 tons of gunpowder, 
which was seized by Stockholm Customs Police in May to 
June 1985. The powder was reportedly destined for Iran and 
other Middle East countries. Customs Police suspicions were 
cited that Bofors had illegally smuggled explosive powder 
and other weapons to Iran "since at least 1983." 

On Dec. 21, 1985, the Stockholm daily Svenska Dagbla- 
det reported the Dec. 17 seizure of another 26 tons of Bofors- 
Nobel Kemi explosives at the Swedish port of Trelleborg. 
They were destined for East Germany and believed by police 
to be destined for reshipment to Iran. 

The event that caused the resignation of Claes Winberg 
was a two-page interview with Karl-Erik Schmitz, in the Nov. 
12, 1985 Expressen magazine. Schmitz told how Iran had 
contacted Bofors via Yugoslavia to buy the explosives. "After 
2 days, Bofors telephoned me to discuss the business." In 
November 1984, Schmitz and a representative from Nobel 
Kemi went to Yugoslavia to conclude the deal; Nobel Kemi 
agreed to provide 200 tons of gunpowder, which was sent to 
Yugoslavia, and transshipped to Iran. 

European arms sales to Iran included the mines that now 
menace the Persian Gulf. But one of the biggest items, 
amounting to over $1 billion of the $3 billion that Iran spends 
annually in its war with Iraq, was munitions: gunpowder, 
explosives, shells, and bullets. While most of Iran's ordnance 
so far is still what was supplied by the United States to the 
Shah' s regime, Iran has been buying munitions from Western 
Europe and anywhere else it can get them. Such munitions 
are essential for military offensives to be preceded by heavy 
artillery barrages. 

According to one firm currently under investigation for 
Iranian arms- trafficking, as much as half of Europe's esti- 
mated annual production of 100,000 tons of explosives, is 
being channeled to the Iran-Iraq War. Many of Iraq's pur- 
chases are legal, through countries like France, which openly 
sells to Iraq. It is the Iranian arms sales that are frequently 
involved in the murky business of phony end-user certificates, 
and private middlemen like Karl-Erik Schmitz. 

Sweden's Nobel was also permitted to construct a $110 
million chemical factory in Isfahan, that Iran could have used 

46 October 1996 

EIR Special Report 

to make explosives, until Iraqi warplanes destroyed the plant. 
One of Iran's biggest orders was for 5,300 metric tons of 
propellant used in heavy artillery shells. Iran placed this $50 
million order with the Italian munitions maker Tirrena Indus- 
triale SpA, which could not fill it, and subcontracted to other 
European firms. 

According to the Wall Street Journal, customs investiga- 
tors in Sweden said Schmitz ran deals that involved compa- 
nies and governments in at least a dozen countries. "Some 
transactions depended on falsified export documents and 
complex shipping arrangements designed to disguise the true 
destination of the explosives he was buying," the Journal re- 

In 1982, Schmitz became involved in Iranian arms, but 
since 1970 his trading company, Scandinavian Commodity 
AB, had supplied fertilizer and non-military materials to Iran 
and other Middle Eastern clients. Schmitz' s first munitions 
supplier was South Africa, also one of his big fertilizer deal- 
ers. But in 1984, South Africa was closed off as a source, when 
it signed an arms agreement with Iraq. This forced Schmitz to 
turn to Europe and Israel. 

In 1983, AB Bofors introduced Schmitz to the Brussels 
offices of the explosives division of Gechem SA, Belgium's 
largest powder maker, known in the industry as PRB . Schmitz 
approached PRB with orders for Greece and other countries 
the firm had previously dealt with. PRB pulled out when it 
noticed that Bank Melli Iran was handling the payments, and 
it bought out of the contract for $250,000. This led Belgium' s 
Parliament to investigate PRB. Schmitz could afford to lose 
suppliers like PRB, partly because the Paris- based European 
Association for the Study of Safety Problems in the Produc- 
tion of Propellant Powder, had begun to parcel out large orders 
from Iran. 

The transactions that led to Schmitz' s indictment in- 

volved a Jan. 2, 1985 telex order from Schmitz to Nobel Indus- 
tries S verige AB , which involved at least a $ 1 64 million arms- 
for-oil barter deal he engineered. The deal was to supply 
enough powder for 900,000 field artillery shells. Nobel sub- 
contracted to Belgian, French, and West German companies, 
while Schmitz arranged for the powder to be shipped to Paki- 
stan, for the final sale to Iran. That spring, Swedish customs 
and police investigating previous transactions at Nobel dis- 
covered the Pakistan deal, and froze it. Nobel President An- 
ders Carlberg ordered all suspicious contracts frozen. Iran 
urged Schmitz to expedite outstanding shipments. 

Schmitz then turned to the European suppliers, beginning 
in Fribourg, Switzerland, with his private company, Serafina 
SA. He hired aircraft from a Panama-based company, HRD 
Holding SA, to fly supplies from Lille, France to Teheran's 
Mehrabad Airport. The Netherlands ' Muiden Chemie B V and 
France's Societe Nationale de Poudres et Explosifs SA deliv- 
ered nearly 20 tons of powder and explosives. A separate 
shipment by Belgium's PRB was stopped at the French 

Three weeks later, another flight left for Teheran, loaded 
with millions of explosive devices for artillery shells. In addi- 
tion, there was a small sample of C-4 plastic explosives on 
behalf of Israel, the first part of a 400- ton shipment Israel may 
have been planning. As trade with European companies was 
choked off, Israel, a long-time supplier of weapons and spare 
parts to Iran, increased its trade, according to documents 
found in Schmitz' s office. Schmitz used the state-owned Is- 
raeli Military Industries to supply many contracts Nobel 
backed out of in 1 985 . The Israeli-connection with Schmitz' s 
business is via a Brussels firm, Distraco SA, involved in the 
export-import of chemicals, whose officially listed principals 
are Alexandre Gourary and Moshe Navon, the latter an Is- 
raeli national. 

Chapter 4 

The death toll rises 

Over the past decade, especially since the first public revela- 
tions of the scandal known as "Iran-Contra," a considerable 
number of prominent world figures have died under mysteri- 
ous circumstances. In many instances, elaborate coverups 
were immediately set in motion, to block honest investigators 
from solving the crimes. In each of the cases that we catalog 
below, the "victims" were all people with considerable 
knowledge about the global underground of weapons traf- 
ficking, drug trafficking, money laundering, and so forth, car- 
ried out with the complicity of the Margaret Thatcher and 
George Bush-run "secret governments" of the 1980s. 

By looking at these murders, one can identify a pattern, 
that links the assassination of Sweden's Olof Palme to many 
of these other cases. This further explains why it is, that the 
"South African connection," recently revealed in the Palme 
case, is not simply tied to Palme's anti-apartheid efforts, on 
behalf of Nelson Mandela and the African National Congress. 
Olof Palme, like all the other murder victims you are about to 
read about below, was killed because he knew too much about 
the East- West arms-for-drugs trade, and he was considered 
a liability. 

• Uwe Barschel, the governor of the German state of 
Schleswig-Holstein, died less than 48 hours before he was 
scheduled to testify before a parliamentary panel, looking 
into illegal arms trafficking between the East and the West. 
Barschel' s death was ruled a suicide, and it took seven years 
for the forensic evidence, that existed all along, to be made 
public, proving that Barschel was murdered. 

• Indian leader Rajiv Gandhi was assassinated at a cam- 
paign rally, to prevent him from assuming the prime minister- 
ship of his country. He had been intimately involved, along 
with Olof Palme, in secret arms transactions, involving the 
same players which we identified in the preceding chapters 
that dealt with Palme's assassination. The Liberation Tigers 
of Tamil Eelam of neighboring Sri Lanka, who carried out 
the murder of Gandhi, are part of the extended "Afghansi" 
apparatus of separatist killers, drug- and weapons-traffickers, 
and mercenaries-for-hire who emerged from the 1979-89 Af- 
ghanistan War. 

• Israel' s Prime Minister Yitzhak Rabin was assassinated 
because he had broken with British geopolitical stratagems, 

and was pursuing a lasting peace with Palestinian Authority 
President Yasser Arafat, and with all of Israel's Arab neigh- 
bors. Such a peace process, strongly backed by the United 
States, would remove one of the most tried and tested instru- 
ments of Club of the Isles power, the ability to manipulate the 
Arab-Israeli conflict in the Middle East. 

A caveat 

The authors do not intend to imply that every one of the 
assassinations cited in this chapter are to be laid personally at 
the doorsteps of George Bush and/or Margaret Thatcher. 
What should become obvious, however, is that every one of 
the targets of assassination was involved in, or was in the 
process of exposing, the vast East- West arms-for-drugs appa- 
ratus that dominated world affairs, especially in the Third 
World, throughout the 1980s. Bush and Thatcher personify 
the "Western branch" of the political structures that fostered, 
deployed, and protected these criminal networks throughout 
their tenure in office — principally on behalf of the interna- 
tional financier oligarchy known as the Club of the Isles. In 
some of these instances, Thatcher and Bush do bear direct, 
personal responsibility for the actions of this apparatus. 

A serious, and thorough investigation into the political 
assassinations catalogued below, would further expose the 
global demimonde, which, today, represents a $1 .2 trillion- a- 
year income stream, derived from the sale of illegal drugs, 
arms, and other precious commodities, and which finances a 
stable of professional assassins, terrorists, and political dirty- 
tricksters, the successors of what Lyndon Johnson, shortly 
before his death in 1973, had labeled a "new, global Mur- 
der, Inc." 

This is the hard core of the self-described "asteroid" appa- 
ratus today. In the 1980s and early 1990s, with Bush and 
Thatcher still in power, the asteroid networks were part of the 
official structures of government, in most instances. Their 
actions were protected, often by complicit officials in posi- 
tions of responsibility in the justice departments, courts, and 
Executive branch agencies. Now, many of these networks 
are off on their own, working on behalf of private interests, 
making them, potentially, more vulnerable to honest law en- 
forcement action. 

48 October 1996 

EIR Special Report 

The mysterious death 
of Uwe Barschel 

On Oct. 10, 1987, Uwe Barschel, a prominent West German 
politician from the northern state of Schleswig-Holstein, 
checked into the Beau Rivage Hotel in Geneva, Switzerland. 
The following morning, he was found, dead, in the bathtub of 
his suite. Despite substantial indications that Barschel had 
been the victim of foul play, for the next seven years, the 
official German government version of BarschePs death was 
that it was a suicide. 

At the time of his death, Barschel was in the center of 
controversy. One month before his death, Barschel had re- 
signed as governor of Schleswig-Holstein, as the result of a 
political scandal. On May 31,1 987, Barschel had nearly been 
killed in a very suspicious plane crash, in which the pilot and 
co-pilot of his private plane were killed. A 15-meter pole had 
been placed at the edge of the runway at Liibeck Blankensee 
Airport, and the private plane crashed into the pole as it at- 
tempted to land. Twenty-four hours prior to the crash, there 
was no such obstruction near the runway. Eyewitnesses also 
later told police that they had heard an explosion just prior to 
the crash; and Barschel later said that he may have heard a 
bomb go off. He spent two months in a hospital recuperating 
from the crash, during which time, the opposition Social Dem- 
ocratic Party (SPD) launched its "political corruption" cam- 
paign against the up-and-coming Christian Democrat. In 
1992-93, as the archives of the East German state security 
service, Stasi, were opened, several of the leading SPDers 
who led the assault upon Barschel were revealed to have been 
Stasi "moles." 

Despite this incident, and despite persistent rumors that 
Barschel had been in Geneva to meet with arms dealers, traf- 

been killed. This seemed to be a far-fetched proposition, be- 
cause German authorities had claimed that crucial autopsy 
tests had not been run on Barschel' s body. It therefore caused 
a major scandal, when, in May 1994, a noted Swiss forensic 
pathologist, Dr. Hans Brandenberger, produced tissue sam- 
ples from Barschel' s body, that showed that he had been 
drugged — prior to his death. The "Brandenberger Report," as 
it came to be known, broke in the German media on Oct. 5, 
1994 — almost exactly seven years after Barschel 's mysteri- 
ous death. On Oct. 13, 1994, Bernd Schmidbauer, German 
Chancellor Helmut Kohl' s chief national security aide, told 
reporters, "Maybe Barschel was assassinated, after all." He 
ordered a thorough review of all of the Stasi archives, to see 
if there was any evidence of an East German hand in the 
Barschel murder. On Dec. 21, 1994, the Barschel case was 
officially reopened by the Schleswig-Holstein court in Lii- 
beck. Wille was appointed to head the investigation. On Dec. 
27, 1994, the investigation was expanded to include the mys- 
terious May 1987 plane crash, in which Barschel was almost 

Immediately following the announcement that the Bar- 
schel case had been reopened, as a murder investigation, the 
German press began reporting some of the most crucial, and 
long-suppressed details about the final days of Uwe Bar- 
schel' s life. 

On Dec. 24, 1994, the Frankfurter Allgemeine Zeitung 
reported on the possible "arms cartel" links to the Barschel 
case. "A former senior officer of the G.D.R. [East German] 
Ministry of State Security (MfS) has told the West German 
security agencies about voluminous arms and technology 
deals, which he said were carried out with the help of the 
former G.D.R. hard currency merchant Schalck-Golodkow- 
ski and West German enterprises — potentially also including 
reputed firms in Schleswig-Holstein." 

The paper said: "Other hints that the [BND, German For- 
eign Intelligence Agency], among others, obtained, relate to 
the evening of Oct. 10, 1987. The day after, the CDU politi- 
cian and former minister president [state governor] in Kiel, 

"Barschel: CIA Agents Were Hanging Around at the Death 
Hotel." Bildzeitung reported that "CIA agents are said to 
allegedly have observed Uwe Barschel, during his stay at 
the hotel Beau Rivage." 

On Dec. 28, 1994, the Berliner Zeitung revealed that an 
informant of the BND had delivered behind-closed-doors 
testimony to judges in Liibeck in the summer of 1992, pro- 
viding details on the purported Geneva meeting. The infor- 
mant identified Rafiq d'Houst, an Iranian Revolutionary 
Guard official, and Ahmed Khomeini, the son of Ayatollah 
Khomeini, as two of the participants in the meeting — along 
with Barschel. German authorities later obtained personal 
notes from a German arms dealer, whom they arrested, which 
referenced a meeting of international arms dealers and 
Iranian government officials in Geneva on the weekend of 
Barschel's death. The notes listed as participants in the meet- 
ing, "Professor Chung-Li, Fafi-Dust, Mohajedi, Ahmed 
Khomeini, Barschel." 

On Dec. 30, 1994, Bildzeitung revealed that another 
member of the Barschel family had died under mysterious 
circumstances, possibly linked to the death of Uwe Barschel. 
Bernd Barschel, a cousin of the late Uwe Barschel, was a 
professor of philology at Schiller University in Jena. He 
was also an asset of the East German Foreign Intelligence 
Service, HVA, which, for decades, was headed by East 
Germany's most famous spymaster, Markus Wolf. In addi- 
tion to his teaching post at Schiller University, Bernd Bar- 
schel worked as a "consultant" for an East German optics 
firm, Zeiss, which was involved, during the Cold War, in 
Warsaw Pact defense research and technical espionage. 
Zeiss, in turn, had entered into several "research partner- 
ships" with the West German defense research company 
Wild-Leitz. Wild-Leitz had a Swiss branch, where Uwe 
Barschel's brother, Eike Barschel, worked. Uwe and Eike 
Barschel were scheduled to meet in Geneva on Oct. 11, 
1987 — the day after Uwe Barschel's death. 

Bernd Barschel, in March 1990, gained access to the 
Stasi archives in Gera, East Germany, and reportedly discov- 
ered files that shed significant light on the death of his cousin. 
In October 1990, Bernd Barschel announced that he would 
go public with the information he found in the Stasi files. 
Two weeks later, Bernd Barschel died of "a heart attack." 

Bildzeitung, in its article on Dec. 30, 1994, quoted a 
Bonn intelligence expert, saying that "one man could shed 
light on the darkness in the Barschel affair: former GDR 
espionage chief Markus Wolf." A member of the Bundestag, 
the German federal parliament, Georg Brunnhuber, told the 
newspaper, "In case Markus Wolf remains silent, he has to 
be kept under arrest until he reveals his knowledge about 
the Barschel case." 

The same day that the Bernd Barschel story was revealed 
by Bildzeitung, the Berliner Zeitung published an interview 
with one of Markus Wolf's top deputies in the HVA, Peter 
Feuchtenberger. When Wolf formally "retired" from the 

HVA directorship in 1986, Feuchtenberger was appointed 
as head of Department XX of the HVA, which was responsi- 
ble for computer espionage and electronic surveillance. He 
told the paper: "There is no doubt that Barschel was involved 
in arms deals. Whenever Barschel was in Warnemuende [an 
East German Baltic port not far from Rostock] and was 
carrying out his deals, the hotel was completely bugged. It is 
strange that all this intelligence is said to have disappeared." 
Asked whether he gave any credence to the idea that the 
Stasi assassinated Barschel, Feuchtenberger replied: "What 
is all this nonsense about the Stasi killing Barschel? The 
Western agencies should just put everything [they have] on 
the table." 

In the summer of 1990, following Bernd Barschel's re- 
view of the Stasi archives, hundreds of pages of documents 
disappeared from the East German files. The West German 
magazine Focus singled out former Bonn Interior Ministry 
official Eckart Werthenbach, as the individual responsible, 
at the time of the disappearance of the documents, for "dis- 
solving the Stasi and securing the files." In early 1991, 
Werthenbach was appointed director of West Germany's 
BfV counterespionage agency. 

Apparently, a second batch of files relevant to the Bar- 
schel case disappeared from the East German archives, in 
late 1994 and 1995, following the reopening of the Barschel 
case. Heinrich Wille discovered that these documents had 
disappeared, after he was able to interrogate several former 
HVA officers, who had knowledge of Barschel's links to 
East Germany, and to the international arms business during 
the 1980s. On Jan. 8, 1995, Klaus Klinger, the state justice 
minister of Schleswig-Holstein, said in an interview with 
Deutschlandradio (German Radio), that at least 200 pages 
of Stasi files relating to the Barschel case had been shredded 
by West German counterespionage agents, because they had 
been deemed "not relevant for the investigation of Barschel' s 
death." Klinger noted, "There is a story behind that story." 

An open file 

The Barschel investigation continues to this day, despite 
efforts to dump Wille from the probe. While no clear explana- 
tion for Barschel's death has emerged in the intervening nine 
years since his final trip to Geneva, and no one has stepped 
forward to reveal what Barschel intended to report in his 
scheduled Oct. 12, 1987 testimony before the Schleswig-Hol- 
stein investigative commission, certain features of the case 
stand out. First, Barschel was apparently personally caught 
up in the East- West arms and espionage nexus of the 1980s. 
Second, he was also apparently involved directly in the illegal 
conduiting of arms to Iran, during the period of the Iran-Iraq 
war. A thorough investigation of the Barschel death, even at 
this late date, would unquestionably lead to dramatic new 
revelations about the subterranean arms and espionage appa- 
ratus, and perhaps, would even solve the question: Who killed 
Uwe Barschel? 

50 October 1996 

EIR Special Report 


Cools and Bull: two 
murders in Belgium 

On July 1 8, 1 99 1 , Andre Cools, a leading figure in the Belgian 
Socialist Party, was assassinated outside the home of his mis- 
tress, in the industrial city of Liege. Cools had been deputy 
prime minister of Belgium, and was the political boss of 
Liege. The murder of Cools was a professional shooting by 
two men who escaped on a motorcycle. 

Within several weeks of Cools' s assassination, Judge 
Jean-Marc Connerrote had apparently cracked the case, and 
was preparing to indict several prominent Socialist Party fig- 
ures, some local Italian Mafia members, and the contract kill- 
ers. But before Judge Connerrote acted, the justice minister 
removed him from the case. As a result, there were no indict- 
ments, and the case was, for all practical purposes, closed. 

Why was Cools murdered, and why did senior govern- 
ment officials move to shut down the investigation, on the eve 
of indictments? 

Cools was murdered within days of his return from a fact- 
finding trip to Geneva and Lucerne, Switzerland. Cools had 
announced to the Belgian press, that he would soon release 
startling evidence about corruption in Belgium's burgeoning 
arms and explosives industry. He was murdered before he 
could release his findings. 

The death of Gerald Bull 

Among the matters that Cools was reportedly investigat- 
ing at the time of his assassination, was the death of arms 
inventor and manufacturer Gerald Bull. Bull was killed out- 
side his Brussels home on March 22, 1990. All of Bull's 
business records disappeared immediately after his murder, 

developed a number of long-range guns, including the most 
advanced 155-millimeter howitzer, and the much ballyhooed 
"Super-Gun," a long-range cannon, thought to be able to 
launch even small satellites into outer space. 

In 1977, beset with financial difficulties, Bull agreed to 
sell parts of Space ResearchCorp. to the government of South 
Africa's state arms- manufacturing company, Armscor. The 
South African broker for the deal was the firm's chief sales 
representative, J.S. Coutzee. Through a series of offshore fi- 
nancial transactions, involving the Caribbean island of Anti- 
gua, the sale was completed, and South Africa became one of 
the world's leading manufacturers of Bull's 155-millimeter 
gun, and ammunition. On the South African side, Bull' s oper- 
ations were abetted by Israel, which already had established 
strong ties into South Africa's defense sector, even develop- 
ing a testing ground for joint Israeli-South African missiles, 
and other sophisticated weaponry. Israel's leading arms 
"salesman," ShaulEisenberg, became a close business associ- 
ate of Bull's in South Africa. 

Bull and Space Research were no strangers to Africa. 
In 1 975, Space Research had been involved in "Operation 
Feature," a U.S. government-sanctioned covert operation 
which provided weapons to Dr. Jonas Savimbi, the leader 
of the UNITA rebels in Angola. "Operation Feature" was a 
predecessor to all of the covert arms dealings of the 1980s. 

The South Africa business deal ultimately blew up in 
Bull's face. He was indicted in the United States during the 
Carter administration, and served four months in federal 
prison, for violating a U.S. arms embargo against South 

When Bull got out of jail, he accepted a lucrative offer 
from the People's Republic of China, to provide them with 
the howitzer technology. Bull used the money to relocate 
Space Research to Belgium, where he entered into a series of 
joint ventures with one of Belgium' s premier arms manufac- 
turers, and a charter member of the "explosives cartel," Pou- 
drieres Reunies de Belgique (PRB). Throughout the 1980s, 
from his new European base of operations. Bull provided 

their knees, as the precedent-setting event of Margaret 
Thatcher and George Bush's "new world order." 

Once again, Bull had found himself in the unfortunate 
position of being in the wrong business, at the wrong time. 
On March 22, 1990, Christopher Gumbley, James's partner in 
the Astra takeover of PRB , met with Gerald Bull at a Brussels 
hotel, to plan out a public counterattack against the "super- 
gun" charges. James, Gumbley, and Bull had a lot to say in 
their own defense. 

Every aspect of the Iraq dealings of Space Research had 
been cleared at the highest levels of the Thatcher and Reagan- 
Bush administrations. Space Research's closest partners in 
the arms dealings with Iraq had been a string of British firms, 
all part-owned by Jonathan Aitken, Thatcher's secretary of 
state for defense procurement, and a leading figure in the Tory 
Party hierarchy. Furthermore, Bull's deals with Iraq had been 
bankrolled by Societe Generale, the banking arm of the So- 
ciet6 Generale de Belgique, a holding company of the Belgian 
royal house, which owns 40% of the country's industry. 

The Belgian- Iraqi contracts had been negotiated by Count 
Herve de Carmoy, a French nobleman and member of the 
Trilateral Commission, who was the international director 
of Britain's Midland Bank, and the co-chairman of Societe 
Generale de Belgique, representing the interests of a large 
bloc of French shareholders. Ironically, Count de Carmoy had 
traveled to Baghdad in 1989, to work out the final details of 
the Space Research contracts with Iraq, along with plans to 
build a series of chemical plants as well. Those plants would 
be later described as "chemical weapons factories," and oblit- 
erated by "coalition" bombing raids in the 1991 Persian 
Gulf War. 

When the Gumbley-Bull meeting at the Brussels hotel 
broke up, Bull returned home. He was gunned down outside 
his house. Two weeks later, Gumbley was arrested and jailed 
in Britain, on vague "corruption" charges. 

Belgian arms trafficking 

If the political and criminal intrigue in the Gerald Bull 
case were some of the matters that Andre Cools had intended 
to expose at the time of his assassination, it was not only 
the "Belgian connection" to the East- West arms-smuggling 
scandals, of which he was aware. 

Belgium, which hosts the headquarters of the North Atlan- 
tic Treaty Organization, enjoys a disproportionate power sta- 
tus within Europe. Brussels is a hub of arms dealing and 
military-industrial espionage. Furthermore, Societe Generale 
de Belgique, the holding company linked to the Belgian royal 
house, exerted control over PRB , and over Belgium' s second 
major arms industry, Fabrique Nationale. The Belgian Ban- 
que Bruxells Lambert was deeply implicated in one of the 
early United States-Israeli covert arms programs, "Operation 
Demavand." And one of the leading Belgian government of- 
ficials of the 1980s, Jean Gol, who served as defense minister 
and interior minister, was a cousin of East Germany ' s Alexan- 

der Schalck-Golodkowski. Gol was also the head of the Bel- 
gian-Israeli Friendship Society, and was widely suspected of 
having his own direct ties to the Mossad. The relationship 
between Gol and Schalck has never been publicly investi- 

Another Antwerp-based arms-smuggling outfit, Casalee, 
which had been set up originally in Rhodesia in the 1970s to 
smuggle arms to the regime of Ian Smith, was involved in 
many of the covert arms deals to Iran and Iraq during the 
1980s. Its founder and director, John Bredenkamp, eventually 
relocated his operation to Britain at the end of the 1980s. 

Cools was also on the board of directors of the Bierset 
Airport, near Liege, which was a transshipment point for 
many arms deliveries to Iran and Iraq, during the period of 
the United Nations embargo. That airport was also under in- 
vestigation for smuggling of weapons to the Armed Islamic 
Group (GIA) in Algeria. 

The pedophile ring 

On Aug. 17, 1996, the five-year coverup of the Cools 
murder, and potentially a whole lot more, came to a shocking 
halt, when Belgian police raided a house in a small city in the 
French-speaking sector of the country, and rescued two young 
girls who had been kidnapped by a pedophile ring. The raid 
resulted in the arrest of Marc Dutroux, a well-known criminal, 
and low-level police informant. The Dutroux arrest unraveled 
an international pedophile ring that reached up into the highest 
levels of the Belgian government, including some of the very 
people who had initially been implicated in the assassination 
of Andre Cools. By arresting Dutroux, the Belgian authorities 
were simultaneously able to round up many of the people 
responsible for the Cools assassination. 

Dutroux, in the meantime, led police to the graves of four 
young girls, all of whom had been murdered by his pedophile 
gang. Within a short period of time, over 30 people were 
arrested, including senior police officials, judicial authorities, 
and politicians. 

The prosecuting judge in the Dutroux case was Jean-Marc 
Connerrote, the same judge who, five years earlier, had briefly 
been in charge of the Cools murder investigation. Among 
those arrested in August 1996 by Judge Connerrote and 
charged in the Cools murder, was Alain Van der Biest, a 
leading member of the Belgian Socialist Party and a one-time 
political ally of Cools. A second seniorBelgian Socialist Party 
official, Guy Mathot, was briefly detained, but later released 
in the Cools murder case. He is still a target of the investiga- 
tion, according to several investigators working under Judge 

Judge Connerrote also arrested two Italian Mafia figures 
linked to the Cools killing. Soon after the arrests in Belgium, 
the Tunisian government arrested two Tunisians, accused of 
being the gunmen in the Cools murder. They were extradited 
to Belgium, and have subsequently confessed to the murder. 
The Tunisian authorities informed Judge Connerrote that the 

52 October 1996 

EIR Special Report 



I T H SI! Hi 

two men were part of the GIA arms-smuggling ring that had 
been operating out of Bierset Airport. Members of the ring 
had been part of the Afghansi mujahideen during the 1980s. 

The Dutroux pedophile ring probe is still expanding. At 
the time of his arrest, Dutroux was running a car-theft, drug- 
smuggling, and pedophile operation, that reached into the 
Netherlands, France, and Germany. A leading figure in the 
pedophile operation, Jean Michel Nihoul, managed the 
gang's finances out of posh offices on the Avenue de Louise 
in the heart of the Brussels business district. He managed a 
string of Dutroux' s properties, including a villa in the Ca- 

Nihoul had been in and out of jail since the 1970s, on a 
wide range of money -laundering, drug-trafficking, and prosti- 
tution charges. He was also a fixture in Belgian right-wing 
circles, linked to the World Anti-Communist League and the 
Christian Social Party. In the 1980s, Nihoul ran an ecology 
cult, called Eco Vie, which was a front for his criminal activ- 

The Nihoul expose has raised fears among some of the 
Belgian elites, that the pedophile bust will force the reopening 
of an earlier case, involving the 1986 murder of a top execu- 
tive of Fabrique Nationale, named Mendez. Mendez was re- 
sponsible for arranging false "end-user certificates" for ship- 
ments of arms destined for Iran, Iraq, and several African 
countries on the United Nations' arms embargo list. 

The Dutroux-Nihoul case has also sparked renewed inter- 
est in a parallel case, unearthed in the United States, as part 
of the late 1980s Congressional and special prosecutors 
probes of the Contra supply operations. The American case 
involved the Franklin Credit Union of Omaha, Nebraska, run 
by Larry King, an African- American Republican Party opera- 
tor, whose savings and loan institution was used to launder 
funds for Oliver North's Contras. When former Nebraska 
state senator John DeCamp launched a probe of King' s activi- 
ties, he unearthed a nationwide pedophile ring, servicing 
some of the most wealthy and powerful figures in the Omaha 
business community, and the Republican Party circles of 

India's former prime 
minister, Rajiv Gandhi 

On May 2 1 , 1 99 1 , as he was campaigning in national elections 
that promised to bring him back to power as the next prime 
minister of India, Rajiv Gandhi was murdered. The method 
was grotesque. At a campaign rally in the southern state of 
Tamil Nadu, Gandhi was killed when he greeted a woman 
who was a suicide bomber of the Liberation Tigers of Tamil 
Eelam (LTTE, or Tamil Tigers). The woman literally ex- 
ploded, killing Gandhi, herself, and eight others. 

Although the Indian government has officially indicted 
Tamil Tigers chief Vil Prabhakharan for the murder, the 
LTTE was more than likely acting not as a derivative assas- 
sin — as in the case of the Sikh separatists who gunned down 
his mother, Indian Prime Minister Indira Gandhi in 1984, 
or the Zionist fanatic who murdered Israeli Prime Minister 
Yitzhak Rabin in November 1995 — but had carried out the 
deed as a contract hit for the Tigers ' protectors. The assassina- 
tion was not motivated in revenge — it was a preemptive 

First, Rajiv Gandhi had shown, in his months of cam- 
paigning, that he would return to office to take the helm in 
India with an administration that would far more resemble his 
mother's years as prime minister, when India was the leader 
of the Non-Aligned Movement and New Delhi forged an inde- 
pendent foreign policy. In the months leading up to the elec- 
tions in 1991, Gandhi had been acting as India's de facto 
foreign minister. 

India had endorsed United Nations Security Council Res- 
olution 678, which had authorized the United States-led coali- 
tion to use force to oust Iraqi troops from Kuwait. By the end 

Indian Prime Minister Rajiv Gandhi. In February 1991, three 
months before his murder, Gandhi had publicly attacked the Bush 
"obliteration" of Iraq. 

"bucking" of the Bush secret government and its "Iran-Con- 
tra" criminal operations. 

On Feb. 18, Gandhi served notice that India must stop 
permitting U.S. Air Force planes to refuel in India, in protest 
of U.S. military operations against Iraq. 

On Feb. 22, Gandhi embarked on a diplomatic mission to 
Moscow, meeting with then-President Mikhail Gorbachov, 
and also with Iranian President Hashemi Rafsanjani, in an 
effort to end the war against Iraq. 

An obstacle to Britain's 'Great Game' 

The removal of Rajiv Gandhi from the scene was a strate- 
gic requirement for London's Great Game in Central Asia. 
The "clash of civilizations" thesis of Samuel Huntington and 
British intelligence eminence Bernard Lewis, would have 
been far more difficult to effect with Rajiv Gandhi as the 
leader of India. Under the Gandhis, India had good relations 
with the Arab world, and had always worked to back the 
Palestinian movement' s efforts for implementation of United 
Nations Resolution 242. 

Additionally, however, the murder of Rajiv Gandhi en- 
sured that, having already broken with George Bush's new 
world order, he would never use his own knowledge of the 
inner filthy doings of the "explosives cartel." 

For, as with Swedish Prime Minister and Gandhi friend 
Olof Palme, the business methods of the Swedish armaments 
company Bofors, had had a major impact on Gandhi's politi- 
cal fortunes, and is perhaps the major reason for his death. Or, 
as the Italian daily Corriere delta Sera presciently headlined 
its story of Oct. 31,1989, "Bofors Scandal Could Be Fatal for 
Indian Prime Minister." 

The Bofors sting 

From 1987 onward, Gandhi had been hounded by a scan- 
dal surrounding the 1986 purchase for $1.4 billion by India 
of howitzer guns. The allegation has been made repeatedly 
that Rajiv Gandhi personally, and other members of his cabi- 
net, siphoned off funds from the deal, as payback. No evi- 
dence has ever been discovered to prove these charges. Never- 
theless, in 1989, the "Bofors scandal" was the number-one 
issue leading to the fall of the Gandhi government. 

What is now known about the deal is that part of the 
delivery of howitzers was to be siphoned off to either Iran or 
Iraq, as part of the Bush-Thatcher effort to arm both sides in 
the Iran-Iraq War, continuing their mutual bloodletting. In 
1986, at the point that the India-Bofors deal was concluded, 
the cartel was making its "tilt" toward Iraq. 

Can it be irrelevant to the assassinations of either Olof 
Palme, or of Rajiv Gandhi, that the Bofors deal was concluded 
four weeks after Palme's death, and eight weeks after the 
two prime ministers had met in Stockholm? The March 1 986 
signing of the Bofors deal had concluded months of negotia- 
tions that had begun in May 1 985 . The Indian Defense Minis- 
try, under Gandhi's close associate Arun Singh, had insisted 
from the beginning that there could be no middlemen in the 
deal. In September 1985, Bofors started production of the 
guns for India — even though the deal had not been struck. In 
October 1985, Rajiv Gandhi met Palme in New York during 
the UN General Assembly, and assured Palme that Bofors 
would get the deal, if all middlemen — repositories for brib- 
ery — were eliminated. 

In January 1986, Palme made a week-long visit to India, 
and assured Gandhi that the Indian government' s stipulation 
against middlemen would be met. It is not known what else 
Palme and Gandhi discussed; however, references are made 
in official documents concerning "political questions." If 
Palme' s crackdown on the Rostock smuggling route indicates 
the Swedish prime minister' s turning away from the war poli- 
cies of Bush and Thatcher, then Rajiv Gandhi, with long- 
standing ties to Palme, would be an obvious discussion 

On Feb. 28, 1986, Palme was killed. On March 24, the 
contract between India and Bofors for the delivery of 410 
howitzers was signed. The official announcement came on 
April 1. 

On April 19, 1987, the so-called Bofors scandal against 
Rajiv Gandhi erupted in the press. Its point of origin was 
Sweden. Swedish Radio charged that the deal had channeled 

54 October 1996 

EIR Special Report 

l.. iSi JLsi 

$50 million in kickbacks to secret Swiss bank accounts of top 
government and Congress Party officials. By the end of the 
summer of 1987, key personnel had been forced out of 
Gandhi's cabinet. The government was silent or evasive — 
given the ultimate destination of a portion of the guns — add- 
ing to the air of speculation of "cover-up." 

The Bofors scandal has never been put to rest. In 1989, 
reportedly it was Chandraswamy and Adnan Khashoggi, two 
key players in "Iran-Contra," along with their partner, Lon- 
rho's Tiny Rowland, who revived the Bofors probe. They 
were behind the scheme by which alleged pages of the diary 
of Martin Ardbo, former president of Bofors-Nobel, who di- 
rectly negotiated the India deal, were published in the Indian 
press, allegedly showing a payoff to the Gandhi government 
through Italy. The diary sheets were highlighted by the British 
Broadcasting Corporation, and the Hindu and the Statesman 
dailies in India. The leading Indian journalists behind the 
story were Chitra Subramaniam of the Indian Express, and 
N. Ram of the Hindu. Despite the gallons of ink spilled around 
the scandal, no evidence has ever come to light to substantiate 
the charges. 

In 1990, after Gandhi was out of power, the Indian govern- 
ment had the Swiss bank account of the brother of close 
Gandhi friend Amitabh Bachan frozen. Delhi was acting on 
a tip from Fairfax Security, hired by V.P. Singh. Based in 
Virginia, Fairfax was owned by Michael Hirshman, formerly 
of U.S. military intelligence and former deputy auditor gen- 
eral for the U.S. Agency for International Development. Al- 
though this lateral scandal forced the resignation of Bachan 
from Parliament, the investigative judge in the case eventually 
determined that the account and theBachan brothers had noth- 
ing to do with Bofors. 

It was determined, however, that money did change 
hands, the primary recipients being three companies who 
standardly operated on Bofors' behalf. These three companies 
are: Svenska SA, AE Services Ltd., and Pitco. 

The world of British intelligence and drues 

connection between him and Rajiv Gandhi has ever been de- 

AE Services is based in Guildford, Surrey, England. AE 
Services is owned by a company called Consortium for Infor- 
mation Assimilation and Output, which is registered in Va- 
duz, Liechtenstein. 

AE Services is run by Maj. Robert Wilson, a former Brit- 
ish Army officer with the Ghurkha regiment recruited by the 
British raj exclusively from Nepal and used in Hongkong. 
Today the Ghurkha special forces regiment is stationed in 
Britain. According to knowledgeable sources, AE Services 
was used by Bofors in efforts to circumvent the Iran-Iraq 
arms embargo. 

AE Services was contracted by Bofors in November 1985 
to get the India deal signed by March 1986. The Bofors pay- 
ment was deposited by AE Services in its account at Nord- 
finanz Bank in Zurich, Switzerland, from which it is cur- 
rently untraceable. 

Pitc, with accounts held at the British Bank of the Middle 
East in Geneva and the Continental Illinois branch in Geneva, 
is believed to be Parmanard International Trading Company, 
owned by the Hinduja brothers, although the brothers deny it. 
The brothers are originally from Sindh province in what is 
now Pakistan. Today they are based in London, the United 
States, Mideast countries, and India. They made their fortunes 
brokering deals in the 1970s between the Shah of Iran and the 
Indian government. They are also the marketers for the Indian 
film industry throughout the Mideast and Africa. The Indian 
film industry is the largest in the world, and is also believed 
to be a major channel of flight capital from India. The Hinduja 
brothers have prodigious ties to both George Bush and Marga- 
ret Thatcher. 

The Hinduja brothers ran into serious trouble with former 
Indian Prime Minister Indira Gandhi in 1980. In 1979, the 
Janata Party government had utilized the services of the Hin- 
duja brothers to negotiate the purchase of submarines from 
the German shipbuilder HKW. The deal was not yet con- 
cluded when Indira Gandhi came back to power in 1980. 

Who killed 
Yitzhak Rabin? 

On Nov. 4, 1995, Israeli Prime Minister Yitzhak Rabin was 
gunned down as he entered his limousine, moments after leav- 
ing a 100,000-man peace rally in Tel Aviv. The gunman had 
managed to enter a highly secured area behind the podium, 
and shoot Rabin twice, from less than a yard away. Within 
two hours of the murder, the Israeli press identified the cap- 
tured killer as Yigal Amir, a member of an anti-Palestinian 
Jewish group which had been demonstrating against Rabin 
for months. His group, Iyal, was notorious for depicting Rabin 
in Nazi uniform, in its posters. Amir proudly said he was 
acting alone, and that he murdered Rabin to stop the Israeli- 
Palestine Liberation Organization peace accords from being 

Ever since the August 1993 surprise announcement that 
Israel and the PLO had struck a deal, Britain has been on a 
full-scale mobilization to stop the accords. At stake, is its 

The Jonathan Institute: 
neo-cons, British agents 

In 1976, the father of future prime minister Benjamin 
Netanyahu, Benzion Netanyahu, became the founding 
chairman of the Jonathan Institute. It was named after 
his oldest son, who died leading the Israeli commando 
raid at Entebbe, Uganda. The group was a main base of 
Benjamin Netanyahu's operations for years, and spon- 
sored a series of international conferences that rallied 
Israel's racist right wing. One conference, in 1984, was 
chaired by Lord Chalfont, a former head of the Mideast 
division of British intelligence, and speakers included 
such neo-con luminaries as Sen. Daniel P. Moynihan 
(D-N.Y.), Jeane Kirkpatrick, terrorist expert Claire 
Sterling, and Washington Times publisher Arnaud de 

It was through his work at the Jonathan Institute 
that Benjamin Netanyahu built up his U.S. Republican 
Party contacts, who bankrolled his campaign for prime 
minister. These include Sen. Al D' Amato (R-N.Y.) and 
his aide Arthur Finkelstein, who ran Netanyahu' s 1 996 
election campaign, and cosmetics king Ronald Lauder. 

control of the Middle East, which has always depended on 
keeping the region at war, or near-war. Moreover, the deal 
threatened to end Britain's ability to use Mideast crises to 
shape the global political environment. Because British pol- 
icy planners considered Rabin essential to implementing the 
accords, they considered his elimination a strategic necessity. 
Former Israeli Prime Minister Shimon Peres, and PLO Chair- 
man Yasser Arafat, remain on a British hit-list, for similar 

Now, one year after the murder, it is clear that Rabin's 
removal from the scene was of far-reaching significance. No 
one has proved capable of replacing him, and as a result, the 
Mideast is again heading toward war. 

Within Israel, Benjamin Netanyahu, who was elected 
prime minister with a margin of less than 1 % of the vote in 
May, has supervised this terrible transformation. He has been 
aided by Gen. Ariel Sharon, Israel's top warhawk, whom 
he appointed to his cabinet. Netanyahu campaigned against 
Rabin's successor, Peres, with the promise of reneging on 
every key feature of the accords, and since his election, he 
has made clear that that is one promise he intends to keep. For 
example, he ordered a new round of Jewish settlements in the 
occupied territories. 

Netanyahu accelerated this reversal of the peace policy 
in September, when, acting against the advice of the Israeli 
military, he ordered the completion of a "tourist tunnel" 
along the Al-Aqsa mosque in Jerusalem. The issue was 
wildly provocative for several reasons. First, every Muslim 
cleric worldwide had condemned the proposed tunnel as a 
horrible sacrilege. Second, a group of "Temple Mount" cults 
had repeatedly tried, over the years, to blow up the Dome 
of the Rock and Al-Aqsa mosques atop Haram al-Sharif, 
and to rebuild Solomon' s Temple in their place, increasing 
Muslim sensitivity about the site. Moreover, it is widely 
known that Netanyahu and Sharon control these cults. And 
further, the Palestinians were already in a state of extreme 
frustration, because of Netanyahu's repeated sabotage of 
the accords. 

The results were predictable. The riots that Netanyahu 
deliberately unleashed, led to over 70 deaths. In their after- 
math, Netanyahu ordered the Army to ring six major Pales- 
tinian cities on the West Bank with tanks. The Army has 
standing orders, in the "worst case scenario," to occupy the 
cities and disarm the 30,000 Palestinian police there. This 
action would likely trigger civil war, and possibly lead to 
war with Egypt and Syria. It seems that all that Rabin has 
sought to accomplish is about to be lost. 

Setting up the hit 

In order to prepare for Rabin's assassination, the British 
plotters launched an international media defamation cam- 
paign to politically isolate and discredit him. To do this, 
they called on the capabilities of the Hollinger Corporation, 
the owners of the London Daily Telegraph and the Jerusalem 

56 October 1996 

EIR Special Report 

Post. The firm has overseen an international British intelli- 
gence dirty tricks network, put together following World 
War II. Its board members are all old hands at this kind of 
business. They include former U.S. Secretary of State Henry 
Kissinger, former British Prime Minister Margaret Thatcher, 
and former British Foreign Secretary Lord Carrington. Lord 
Jacob Rothschild and former Israeli President Chaim Her- 
zog, both top British intelligence operatives, are also mem- 
bers of the board. 

As part of this campaign to discredit Rabin, Britain also 
rallied its "neo-conservative" apparatus in the United States, 
centered around the American Spectator magazine, the Anti- 
Defamation League (ADL) of B'nai B'rith, and related cir- 
cles who dominated the Dole Presidential campaign. In addi- 
tion to mobilizing against Rabin within the United States, 
this same apparatus promoted and bankrolled Netanyahu 
and Sharon. 

And, at the same time, Britain unleashed its "Temple 
Mount" cults on a killer rampage. The United Grand Lodge 
of England' s Quatuor Coronati lodge in London has always 
managed these cults. Their function was to supply the dupe 
used to murder Rabin; their kooky ideology was also useful 
in obscuring the British conspiracy behind the murder. 

The first reaction by the opposition Likud bloc to the Au- 
gust 1993 announcement of the accords was low-key. The 
party was awaiting orders from abroad, and those orders were 
not long in coming. In early September, Netanyahu charged 
Foreign Minister Shimon Peres with high treason in the Knes- 
set (Israeli parliament); Peres denounced Netanyahu with act- 
ing on behalf of U.S. financiers. 

British agent of influence Henry Kissinger was the first 
prominent international figure to denounce the accords. Any- 
one who thought that the new accords would lead to peace 
were victims of euphoria, he told CBS News on Sept. 11, 
1993. Two weeks later, Kissinger addressed Lord Roth- 
schild' s Institute for Jewish Affairs in London, and predicted 
that Jordan would disintegrate through an Islamic fundamen- 
talist takeover, ending the possibility of implementation of 

Israeli Prime Minister Yitzhak Rabin 's decision to finally negotiate 
peace with the PLO made him a marked man. British intelligence 
considered his elimination a strategic requirement. Pictured here 
at a White House press conference on March 16, 1994. 

leading element in the neo-con apparatus; it is also a masonic 
organization loosely affiliated with the United Grand Lodge 
of England. Bush Ambassador to the UN Jeane Kirkpatrick, 
another Dole adviser, was also a key speaker at the event. 

Two weeks later, the same crowd organized a similar 
event at Brandeis University, which was addressed by Jerusa- 
lem Post editor David Bar-Ulan, a longtime Netanvahu crony 

5/nce /i/s May 7996 election, Israeli Prime Minister Benjamin 
Netanyahu has loyally followed the British script of attempting to 
plunge the Mideast back into war. Pictured at a White House press 
conference on July 9, 1996. 

Mobilizing a mutiny 

This mobilization bore fruit in February 1994, when a 
Jewish gunman killed 50 Muslim worshippers in a mosque in 
Hebron, to protest the accords. The gunman, Baruch Gold- 
stein, was an official in the JDL West Bank settlement of 
Kiryat Arba. The settlement was also the home of Rabin' s 
assassin, Yigal Amir. It was in order to raise funds for the 
settlement that Sharon had toured the United States four 
months earlier. 

Prime Minister Rabin immediately denounced Goldstein 
and his cronies as an "errant weed," which, he said, "grew in 
a swamp whose murderous sources are here, and across the 
sea." The Israeli government soon declared the JDL and asso- 
ciate organizations illegal, and the United States followed 
suit. Britain and France refused to do so. 

Despite the ban, the mobilization against the accords ac- 
celerated. In March, for example, Netanyahu's mentor, for- 
mer Israeli Prime Minister Yitzhak Shamir, called for soldiers 
to disobey any orders to implement the accords. "If a com- 
mander orders a soldier to kill his mother, does he have to 
follow such an order? Evacuating Jews from their homeland 
[i.e., the occupied territories] is like killing their parents, 
their history." 

While Shamir was calling for rebellion, ADL National 
Chairman Abraham Foxman, in the United States, was at- 
tempting to rally American Jewry against the Israeli govern- 
ment, and against the Clinton administration, for supporting 
the peace plan. 

In a statement to the Jerusalem Post on April 2, 1994, 
Foxman condemned Rabin for trying to prevent the ADL 
from mobilizing against the Clinton administration. Foxman 
charged that Rabin and Peres had pressured the ADL not to 
push for an end of the Arab boycott of Israel, and not to insist 
that occupied East Jerusalem was part of Israel. The Rabin 
government, Foxman complained, is "undermining orga- 
nized Jewry's clout." 

Then, in July, a group of U.S. rabbis flew to Kiryat Arba, 
for a meeting at the home of former Chief Rabbi Schapira. 
There, they issued a religious ruling that it was against 
Jewish law for any soldier to comply with orders to dismantle 
Jewish settlements, resulting from the accords. Rabin imme- 
diately denounced the ruling on state radio. "It is inconceiv- 
able that we will turn the state of Israel into a banana repub- 
lic," he said. 

Countdown to the assassination 

Throughout 1994 and into 1995, the media slanders, and 
cult rampage continued. Soon, Yigal Amir' s group, and other 
groups, were holding weekly demonstrations in front of 
Rabin's home. Meanwhile, in the Knesset, Netanyahu and 
Sharon were increasingly more violent in their denunciations 
of Rabin. 

In an interview with NBC on Nov. 7, 1995, Leah Rabin, 
Prime Minister Rabin' s widow, described the climate of hate 
against her husband that had been created. "There was a cli- 
mate that allowed this to happen, a climate of enormous vio- 
lence, talking violence, picketting violently. People on the 
streets, posters, showed Yitzhak Rabin with the head cover 
of Yasser Arafat, calling him traitor, calling him murderer. 
Every Friday afternoon here in our street there were the same 
people coming and saying, 'Murderer, traitor, traitor, mur- 
derer.' And the last Friday, I came home at 3, left my car, and 
there they were. They had big yelling and big shouting, and 
then they said, 'Wait. In another year, in another year we will 
kill you both on the Kings of Israel Square' — that is where 
the rally took place, because they knew about the rally that 
was going to be." 

Within the United States, the mobilization against Rabin 
also increased in intensity. 

In the first week of October 1995, Yitzhak Rabin made 
his last visit to the United States, where he came into sharp 
conflict with the ADL and related neo-con outfits. Press ac- 
counts in the Jewish and Israeli press give the flavor of the con- 

• Jewish Telegraph Agency, Oct. 5: "In a series of meet- 
ings with Jewish leaders and journalists, Rabin targeted the 

58 October 1996 

EIR Special Report 

increasingly vocal segment of American Jewry opposed to 
his policies. . . . These latest encounters with American Jews 
came in the wake of last week's signing ceremony in Wash- 
ington of the interim agreement between Israel and the Pales- 
tine Liberation Organization. . . . 

"Rabin's comments made front-page news in Israel with 
Yediot Aharonot, the country' s largest circulation newspaper, 
blasting the headline 'Rabin Against the Jews' in its Sunday 
edition. Another major Israeli daily, Ma'ariv, reported that 
Rabin had called groups opposed to his policies muktzeh (out- 
side the pale). The paper quoted Abraham Foxman, national 
director of the Anti-Defamation League, and Seymour Reich 
of the American Zionist Movement, as saying the prime min- 
ister had made a major mistake." 

• Forward, Oct. 20: "Yitzhak Rabin's Own Chutzpah," 
was the headline on an article by Likud ideologue Shmuel 
Katz. (The paper' s editorial board is dominated by ADL offi- 
cials.) It read: "Mr. Rabin accuses the American Jews of 
chutzpah because they protest against American money being 
given to Yasser Arafat. The chutzpah is all Mr. Rabin's. The 
protesting American Jews do not want their taxes to be used 
for the strengthening of a terrorist who — incidentally — 
means to bring about the destruction of Israel. These Ameri- 
cans still recoil at the recollection of that handshake on the 
White House lawn." 

Accompanying Katz's article was an op-ed by Abraham 
Foxman, saying, "One can understand the passion of Ameri- 
can Jews 'lobbying' against the policies of the Israeli govern- 
ment. Indeed, every caring Jew has a right to his opinion about 
the safety and security of Israel." 

• Washington Jewish Week, Oct. 12: "American Jews 
Divided — Peace Process Opponents 'Treasonous'?" was the 
headline of an article. It said, "Late last month, Israeli Prime 
Minister Yitzhak Rabin lashed out at American Jews who 
lobby in Washington against the Israeli government' s negoti- 
ating policy toward the Palestinians. Rabin told members of 
Jewish organizations that American Jewish erouos should not 

based Lubavitcher Rabbi Avraham Hecht, of Congregation 
Sha'are Zion, in an interview with writer Robert Friedman, 
that appeared in the Oct, 9, 1995 issue of New York magazine. 
Following the Rabin assassination, Yigal Amir said he was 
acting under rabbinical orders. 

Rabbi Hecht is the "spiritual adviser" to one of the leading 
members of the ADL's "Millionaires Club," banker Edmond 
Safra. Safra, who owns a string of banks in the United States, 
Brazil, and Switzerland, which have been accused by the Drug 
Enforcement Administration of laundering drug money for 
the Syrian and Colombian cartels, made a $1 million tax- 
exempt contribution to the ADL in the mid-1980s, and re- 
mains one of the League's largest donors. 

The Ledeens and 
Temple Mount 

Among the chief 
conspirators in the 
plot to blow up the 
mosques on top of the 
Haram al-Sharif, and 
to rebuild Solomon' s 
Temple, is the hus- 
band-wife team of 
Michael and Barbara 

In 1982-83, while 
members of the At- 

eret Cohanim yeshiva were tunnelling under the Tem- 
ple Mount, the above-ground propaganda drive for re- 
building the Temple was being run by the Washington, 
D.C. -based magazine Biblical Archaeoloev Review: 

Michael Ledeen 

The Temple Mount' 
patsy factory 

Rabin gunman Yigal Amir is the product of a British-con- 
trolled Jewish cult, dedicated to blowing up the Dome of the 
Rock and Al-Aqsa mosques atop Haram al-Sharif in Jerusa- 
lem, and rebuilding Solomon's Temple in their stead. It was, 
at the latest, during his training in the Kerem B'Yavneh ye- 
shiva, a hot-bed of this cult, that Amir was tracked by the 
British network that controls it. 

Control over the cult is maintained by the Quatuor Coro- 
nati lodge of the United Grand Lodge of England, which was 
established in 1884, following the visit of the Prince of Wales 
(the international head of Freemasonry) to the Holy Land. The 
Masons claim to be descended from the original Phoenician 
builders of the Temple, and Masonic ideology contributed, in 
part, to Lord Palmerston and the Earl of Shaftesbury creation 
of the Zionist movement in the 1 840s. Destroying the Dome of 
the Rock mosque (from where Muslims believe Mohammad 
ascended to Heaven), in order to build the Third Temple, was 
also considered an efficient way to generate decades-long 
Islamic- Jewish religious conflict in the Mideast. 

Within Judaism, the elements assembled around this alien 
cult were led by Rabbi Avraham Isaac Kook, the British agent 
who became the first Chief Rabbi of Israel, and Zionist leader 
and fellow British agent Vladimir Jabotinsky. Their branch 
of Zionism has always been dedicated to destroying the Is- 
lamic and Christian holy places in Jerusalem, and creating a 
paganized Judaism practicing animal sacrifice at their temple. 
Kook was the spiritual adviser to Jabotinsky' s Irgun, and 
Benjamin Netanyahu's father, Benzion, was Jabotinsky' s 

In 1921, Kook formed the Torat Cohanim Yeshiva in 
Jerusalem, which was dedicated from its inception to seizing 
control of the Haram al-Sharif, the Muslim complex in which 
the Al-Aqsa mosque is located, in order to rebuild Solomon's 
Temple there. The founding document of the yeshiva makes 
clear the connection between Jabotinsky' s Zionism and Kab- 
balistic paganism. It reads, in part: "In this epoch of national 
[Zionist] awakening, an establishment such as this is of para- 
mount importance. The main pillar of our present revivalism 
is based on a deep-seated hope of old to see once more the 
priest and Levites performing their sacerdotal rites [i.e., sacri- 
ficing animals]. God's message concerning the rebuilding of 
the temple and the renovation of the sacerdotal rites will cer- 
tainly be fulfilled very shortly." 

Although these elements within the Zionist movement 
were always dedicated to this pagan objective, it was only 
after the Israeli Army seized control of East Jerusalem and 
the West Bank in 1967, where many of the key Islamic and 

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Dole foreign policy adviser Jeane Kirkpatrick typifies the neo-con 
fanatics committed to drowning the Mideast peace accords in 
blood. Pictured at a news conference to outline a foreign policy 
agenda for the Republican-controlled Congress, December 1994. 

Christian holy sites are located, that their gameplan was put 
into motion. In that year, Asher Kaufman, an operative of 
London's Quatuor Coronati lodge, arrived in Jerusalem to 
oversee an assault on Jerusalem's holy places, both Christian 
and Islamic, and to create a cultist movement useful in deploy- 
ing assassins and terrorists. 

One of the first persons Kaufman began to work with, was 
Kook's son, Rabbi Zvi Yehuda Kook. The younger Kook 
promptly became a key ally of Kaufman in the plot against 
the Haram al-Sharif, and he simultaneously deployed his fol- 
lowers to open up the Kiryat Arba settlement outside of He- 
bron, and charged them with taking over the Muslims' Cave 
of the Patriarchs. Rabin assassin Yigal Amir's yeshiva was 
created by this Kook-ist movement. 

One of Kook' s most important proteges was Rabbi Meir 
Kahane, the founder of the Jewish Defense League. Another 
top protege was Rabbi Moshe Levinger, the founder of the 
associated Gush Emunim (Bloc of the Faithful), the political 
heir of Kahane. 

In 1978, two disciples of Rabbi Zvi Kook, Mattiyahu Dan 
and Rabbi Shlomo Aviner, established the Ateret Cohanim 
(Priestly Crown) Yeshiva in the Muslim quarter of occupied 
East Jerusalem. Both Dan and Aviner were officers of Israel's 
domestic intelligence service, the Shin Bet, and were de- 
ployed by Gen. Ariel Sharon. 

The stated purpose of their yeshiva was to train rabbinical 

60 October 1996 

EIR Special Report 


students in animal sacrifice, which was to be practiced in 
the rebuilt temple. In 1980, Dan established the Jerusalem 
Reclamation Project to buy up the Arab quarter of the city, in 
order to make Jerusalem Muslim-free. 

In 1982, Dan et al. began to secretly tunnel under the 
Haram al-Sharif, in order to dynamite the Islamic holy sites 
on top. Also in 1982, a JDL member named Alan Goodman 
walked onto the Haram al-Sharif and began firing on Muslims 
at worship, killing one. 

In 1 984, Irving Moskowitz of Florida, a board member of 
the Ateret Cohanim, founded the American Friends of Ateret 
Cohanim to provide a funding channel for these terrorists. 
Contributors included Marc Be)zberg, a Canadian real estate 
developer, and Cyril Stein, a top figure in the British gam- 
bling syndicate. 

Speakers at the American Friends of Ateret Cohanim fun- 
draising events have included Benjamin Netanyahu, who key- 
noted their founding annual dinner in 1987. Ariel Sharon and 
Israeli President Chaim Herzog (also a board member of Hoi - 
linger), have also spoken at their events. In 1990, Jeane Kirk- 
patrick gave the keynote at the group's annual banquet. In 
1991, Sen. AlfonseD'Amato (R-N.Y.) gave the keynote. And 
in 1992, Netanyahu's longtime close friend, U.S. Secretary 
of Housing and Urban Development Jack Kemp, gave the 
annual address. 

Moskowitz was the first person that Netanyahu called, 
after he opened the tunnel under the Al-Aqsa mosque. In 
1995, according to Internal Revenue Service records, he was 
giving the Temple Mount crazies $6 million a year. 

The case of 
Cyrus Hashemi 

represented himself as the "foreign minister" of the Order 
of Malta. 

The full story of Hashemi's life and death is detailed in 
the 1992 EIR Special Report, "Treason in Washington: New 
Evidence on the 'October Surprise.' " EIR showed that Ha- 
shemi and his lawyer-business partner, J. Stanley Pottinger, 
played a crucial role during the 1980 hostage crisis around 
the issues of the Shah's wealth and the frozen Iranian assets. 
EIR showed that Hashemi's and Pottinger' s manipulation of 
these issues played a critical role in delaying the release of 
the American hostages until after the 1980 elections. 

It is not irrelevant that Pottinger, who described himself 
as a dose friend of George Bush, was also in line to become 
Attorney General in the new Reagan-Bush administration un- 
til his role with Hashemi was exposed. After EIR identified 
Hashemi as a conduct for Iranian funds into U.S.-based terror- 
ist groups, Hashemi, with Pottinger as his lawyer, filed a law- 
suit against EIR in 1980; the case was dismissed in 1983 after 
Hashemi repeatedly refused to comply with court-ordered 

During 1980, Hashemi and Pottinger were already help- 
ing to supply Iran with urgently needed arms and spare parts 
in violation of the Carter administration' s arms embargo. Dur- 
ing the first two years of the Reagan-Bush administration, 
they were permitted to arrange large shipments of arms, am- 
munition, and even C-4 explosives to Iran — far larger and 
more deadly than the arms shipments arranged by Oliver 
North and company during 1985-86, which came in for so 
much scrutiny and investigation. The Hashemi-Pottinger 
shipments were never investigated by Congress — even 
though the information was known. 

Hashemi was finally indicted in 1984 for the relatively 
small shipments made to Iran during 1979-80, but he was 
tipped off by the Justice Department and was allowed to flee 
the country. Pottinger was also scheduled to be charged, as 
the result of aggressive action by the FBI and federal prosecu- 
tors in New York, but at the last minute a set of crucial surveil- 
lance, tanp.R "disannp.arpH " flllnwina Pnttincrpr to p.srane in- 

The Temple Mount' 
patsy factory 

Rabin gunman Yigal Amir is the product of a British-con- 
trolled Jewish cult, dedicated to blowing up the Dome of the 
Rock and Al-Aqsa mosques atop Haram al-Sharif in Jerusa- 
lem, and rebuilding Solomon's Temple in their stead. It was, 
at the latest, during his training in the Kerem B' Yavneh ye- 
shiva, a hot-bed of this cult, that Amir was tracked by the 
British network that controls it. 

Control over the cult is maintained by the Quatuor Coro- 
nati lodge of the United Grand Lodge of England, which was 
established in 1884, following the visit of the Prince of Wales 
(the international head of Freemasonry) to the Holy Land. The 
Masons claim to be descended from the original Phoenician 
builders of the Temple, and Masonic ideology contributed, in 
part, to Lord Palmerston and the Earl of Shaftesbury creation 
of the Zionist movement in the 1 840s. Destroying the Dome of 
the Rock mosque (from where Muslims believe Mohammad 
ascended to Heaven), in order to build the Third Temple, was 
also considered an efficient way to generate decades-long 
Islamic-Jewish religious conflict in the Mideast. 

Within Judaism, the elements assembled around this alien 
cult were led by Rabbi Avraham Isaac Kook, the British agent 
who became the first Chief Rabbi of Israel, and Zionist leader 
and fellow British agent Vladimir Jabotinsky. Their branch 
of Zionism has always been dedicated to destroying the Is- 
lamic and Christian holy places in Jerusalem, and creating a 
paganized Judaism practicing animal sacrifice at their temple. 
Kook was the spiritual adviser to Jabotinsky' s Irgun, and 
Benjamin Netanyahu's father, Benzion, was Jabotinsky' s 

In 1921, Kook formed the Torat Cohanim Yeshiva in 
Jerusalem, which was dedicated from its inception to seizing 
control of the Haram al-Sharif, the Muslim complex in which 
the Al-Aqsa mosque is located, in order to rebuild Solomon's 
Temple there. The founding document of the yeshiva makes 
clear the connection between Jabotinsky' s Zionism and Kab- 
balistic paganism. It reads, in part: "In this epoch of national 
[Zionist] awakening, an establishment such as this is of para- 
mount importance. The main pillar of our present revivalism 
is based on a deep-seated hope of old to see once more the 
priest and Levites performing their sacerdotal rites [i.e., sacri- 
ficing animals]. God's message concerning the rebuilding of 
the temple and the renovation of the sacerdotal rites will cer- 
tainly be fulfilled very shortly." 

Although these elements within the Zionist movement 
were always dedicated to this pagan objective, it was only 
after the Israeli Army seized control of East Jerusalem and 
the West Bank in 1967, where many of the key Islamic and 

&r* ■■■'■■-w. 1 


Dole foreign policy adviser Jeane Kirkpatrick typifies the neo-con 
fanatics committed to drowning the Mideast peace accords in 
blood. Pictured at a news conference to outline a foreign policy 
agenda for the Republican-controlled Congress, December 1994. 

Christian holy sites are located, that their gameplan was put 
into motion. In that year, Asher Kaufman, an operative of 
London's Quatuor Coronati lodge, arrived in Jerusalem to 
oversee an assault on Jerusalem' s holy places, both Christian 
and Islamic, and to create a cultist movement useful in deploy- 
ing assassins and terrorists. 

One of the first persons Kaufman began to work with, was 
Kook's son, Rabbi Zvi Yehuda Kook. The younger Kook 
promptly became a key ally of Kaufman in the plot against 
the Haram al-Sharif, and he simultaneously deployed his fol- 
lowers to open up the Kiryat Arba settlement outside of He- 
bron, and charged them with taking over the Muslims' Cave 
of the Patriarchs. Rabin assassin Yigal Amir's yeshiva was 
created by this Kook-ist movement. 

One of Kook's most important proteges was Rabbi Meir 
Kahane, the founder of the Jewish Defense League. Another 
top protege was Rabbi Moshe Levinger, the founder of the 
associated Gush Emunim (Bloc of the Faithful), the political 
heir of Kahane. 

In 1978, two disciples of Rabbi Zvi Kook, Mattiyahu Dan 
and Rabbi Shlomo Aviner, established the Ateret Cohanim 
(Priestly Crown) Yeshiva in the Muslim quarter of occupied 
East Jerusalem. Both Dan and Aviner were officers of Israel' s 
domestic intelligence service, the Shin Bet, and were de- 
ployed by Gen. Ariel Sharon. 

The stated purpose of their yeshiva was to train rabbinical 

60 October 1996 

EIR Special Report 


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Iranian arms dealer Cyrus Hashemi set up a "sting " operation resulting in the arrest of 17 arms dealers and others in April 1986. 
Hashemi died mysteriously in London about three months later, and in November 1986, lawyers for the defendants attempted to have 
Hashemi's body exhumed and autopsied. However, his grave was not where it was supposed to be. 

Government wiretaps of Hashemi's conversations with some of the arms dealers, recorded them saying that Vice President Bush had 
approved of their deals. Finally, the government dropped the charges, rather than hold a trial where Bush would become the issue along 
with other U.S. government officials. 

being set up by Customs against some other arms dealers. The 
CIA interposed no objection. 

On March 26, 1986, Hashemi secretly returned to the 
United States and appeared in court for an arraignment. He 
pled not guilty, and was released on $ 100,000 bond. Hashemi 
was allowed to keep his passport and travel abroad — unheard 
of for someone who had been a fugitive for almost two years ! 

Four weeks later, on April 22, 1986, the arrests and indict- 
ments of 17 arms dealers were announced with great fanfare 
by the U.S. Customs Service. Among those arrested was re- 
tired Israeli Gen. Abraham Bar-Am, and attorney Samuel 
Evans (a business partner of Khashoggi). U.S. Customs chief 
William von Raab called the ring "brokers of death who oper- 
ated a terrorist flea market." 

Syndicated columnist Jack Anderson later wrote that 
North knew well in advance about the "sting" operation with 
Cyrus Hashemi. Anderson wrote, "One North intimate said 
the colonel boasted weeks before the indictment that he had 

secretly 'set up' the case to keep the decks clear for his own 
operation." North wanted to "eliminate the competition," An- 
derson said. The London Observer wrote in 1987 that the 
purpose of the arrests of the Evans/Bar- Am ring had been for 
"clearing the ground" for the secret trip to Teheran in May 
1986 by National Security Adviser Robert McFarlane, Oliver 
North, and Amiram Nir. Had the Bar- Am deal for jet fighters, 
artillery, and missiles gone through, this theory goes, then the 
Iranians would have had no incentive to make an arms-for- 
hostages deal with McFarlane and North. 

'He knew too much' 

But meanwhile, Hashemi, who had been in excellent 
health, suddenly took ill in London. He was diagnosed as 
suffering from acute leukemia. Two days later, on July 21, 
Hashemi was dead; the cause of death given by Scotland Yard 
was acute leukemia complicated by a stroke or strokes. 

Cyrus Hashemi's brother Jamshid was among the most 

62 October 1996 

EIR Special Report 




vociferous in claiming that he had been murdered. "Cyrus 
knew too much," Jamshid told the London Observer. "He had 
grown too big. He was no longer taking orders and had to 
be silenced." 

An American lawyer who had worked with Hashemi for 
many years told EIR that he believed that "somebody hastened 
Cyrus' s departure from this earth." The lawyer, like almost 
everyone else who knew Hashemi, said that Hashemi had 
crossed so many people, including the Mossad, the CIA, and 
the Iranians, that any of them could have done it. 

At least one of the defendants asked that Hashemi's body 
be exhumed for a second autopsy, a request which the govern- 
ment opposed. 

A March 23, 1987 letter from a defense attorney to the 
court cited published statements by a "Mr. Meheran," an indi- 
vidual whom the government had identified as being video- 
taped in meetings with Cyrus Hashemi and Samuel Evans. 
"Meheran" only identified as an Iranian-born U.S. citizen, 
was quoted by a London paper as saying that U.S. Customs 
agents had told him on three occasions that Hashemi had 
been "got rid of by an unidentified U.S. government agency 
because he knew "too much" about U.S. secret arms ship- 
ments to Iran. The defense lawyers told the court that they 
had met personally with "Meheran," and that he had told them 
the same thing. 

A defense motion submitted in June 1987 pointed out, 
that although the government was ridiculing the notion of 
foul play in the death of Hashemi, "a Congressional investi- 
gator has made two trips to England to meet with the govern- 
ment and medical authorities familiar with the Hashemi 
case." A Congressional source was quoted by the Los 
Angeles Times as saying, "Given all the circumstances, we'd 
be ignoring our responsibility if we didn't follow up what 
is, at the very least, a mysterious death of an important link" 
in the Iran arms affair. 

The defense motion also quoted the Los Angeles Times 
as saying: "The investigating committees are likely to be 

intp.rp.Qte.H in the nnnnrpnt rplntinnshin of thp Rritish intplli- 

what he's doing." 

Samuel Evans was overheard telling Hashemi on that 
same day: "The green light now finally has been given, [that] 
Bush is in favor, Shultz against." 

Requests for pre-trial discovery of evidence sought evi- 
dence from numerous government offices, with the Office of 
the Vice President leading the list in many instances. 

OnNov. 12, 1986, oneofthe defendants, GurielEisenberg, 
attempted to subpoena George Bush for his trial. An affidavit 
submitted by Eisenberg' s attorney stated: 'Tape recordings 
furnished to defense counsel by the government suggest that 
the defendants believed that the sale of arms was being consid- 
ered and would be approved by Vice PresidentBush. The testi- 
mony of the vice president is necessary in order to establish 
that defendant Eisenberg' s belief was reasonable." 

The trial was continually delayed as more and more infor- 
mation about the "Iran-Contra" arms sales came out, and as 
the government stalled and stonewalled on discovery re- 
quests. Ultimately, the government dropped the charges, 
rather than face a trial in which the issue would become, 
"What did Bush know?" 

On Jan. 4, 1 989, shortly before the inauguration of George 
Bush as President, the government filed a nolle prosequi dis- 
missing the indictments. Among the reasons given by the 
government to justify dropping the case, was the death of one 
of their key witnesses, Cyrus Hashemi. 

George Perry and 
the Tabatabai bust 

On April 8, 1983, some men fishing in Lake Tiorati in 

Harriman Statp. Park nnrth of Npw Ynrlc Pitv fnnnd the 

tabai had been paying for arms shipments with drugs. An 
account published in West Germany said that the CIA had 
planted the drugs on Tabatabai in order to sabotage his arms 
deals. The story also circulated that Tabatabai believed Perry 
had planned the operation, and ordered him killed in retali- 

Perry had grown up in Prague, and worked for the OSS 
during World War II. After the war, he served as a briefing 
officer at the Nuremberg Tribunals. Perry travelled widely, 
spoke six languages, and had business dealings all over the 
world, but especially in West Germany, Switzerland, Britain, 
Brazil, and Saudi Arabia. At the time of his disappearance, 
he was an international trade consultant for Stiil, Inc., of 
Sao Paulo, Brazil. 

In November or December 1982, Perry served as an 
intermediary in an arms deal between Joseph Vanacek, the 
president of Stiil, and Sadegh Tabatabai. Perry arranged for 
Tabatabai and Vanacek to meet in Zurich in December 1982, 
at which meeting Vanacek agreed to sell $1 billion in arms 
to Iran. The contract was to be drawn up in Switzerland, 
and the arms shipped from Brazil. But before the deal was 
consummated, Tabatabai was arrested in Diisseldorf. 

On the weekend that Tabatabai was arrested, Perry was 
supposed to meet Vanacek in Zurich and then accompany 
him on a business trip to East Germany. However, Perry 
cancelled his plane reservations to Zurich, and apparently 
never left New York. 

The head of Still's New York subsidiary, Sucotec, Inc., 
was Milan Jedlicka, a relative of Vanacek. In June 1982, 
Jedlicka had pled guilty to conspiring to sell nearly 13 
pounds of cocaine, but, incredibly, he was only sentenced to 
probation for three years. The key person in the conspiracy, 
according to police, was John Henehan. Henehan had appar- 
ently seen too much, for while he was awaiting sentencing, 
he was shot and killed with bullets through his eyes. Two 
weeks later, the prime suspect in Henehan' s death was 
also killed. 

In 1991, during a divorce proceeding in Queens, New 
York, Jedlicka' s former wife Hermi stunned the courtroom 
when she said that her ex-husband had received a $150,000 
payoff for arranging for Perry's murder. She said that Jed- 
licka had accused Perry of "not dancing to the right tune" 
in certain business arrangements. 

Sources told the New York Daily News at the time that 
Perry may have unwittingly gotten involved in a deal to 
exchange F-15 fighter planes from Brazil for cocaine 
from Iran. 

Some other 
strange deaths 

Gen. Rene Audran of France was killed by Action Directe 
terrorists on Jan. 26, 1985. General Audran was engineer of 
armaments and head of the international department of the 
French Defense Ministry. According to the Babra report, he 
was knowledgeable about the arms shipments to Iran by the 
Luchaire Company, and may have been trying to stop them. 

Rear Adm. Carl Algernon of Sweden allegedly fell to his 
death under the wheelsof a Stockholm subway train on Jan. 15, 
1987. Algernon was the war materiel inspector of the Trade 
Department of the Swedish Foreign Ministry, in charge of is- 
suing export licenses for weapons shipments. He died a few 
days before he was scheduled to testify concerning the illegal 
Bofors arms sales to Iran. 

Stefan Ruedell of Germany allegedly committed suicide 
on Oct. 29, 1987. Ruedell had reportedly been spying on the 
Social Democratic Party leadership in Schleswig-Holstein on 
behalf of the Christian Democrats; his death is thus linked to 

Hans- Joachim Knack, the undersecretary of the Interior 
Ministry of Schleswig-Holstein, died on Nov. 9, 1987. His 
death was attributed to a heart attack. Knack was about to tes- 
tify before a state parliamentary committee in Kiel on the B ar- 
schel affair. 

General Giorgieri of Italy was assassinated by terrorists 
on March 21, 1987 in Rome. On Nov. 6, 1987, La Stampa of 
Turin linked the murders of Palme, Giorgieri, andFrench Gen- 
eral Audran with illegal arms deals with Iran. La Stampa said 
that Giorgieri and Audran worked togetherclosely. 

Herbert Amry, Austrian ambassador to Greece, died in 
July 1 985, allegedly of a heart attack. Amry had told a commis- 
sion of inquiry in Vienna that field guns sold to Greece by the 
Austrian company Voest-Alpina were being channelled to 

Heribert Apfalter, general director of the Austrian state- 
owned armaments company Voest-Alpina, died on Aug. 26, 
1987, also attributed to a heart attack. Apfalter was stricken 
several days before he was scheduled to testify before the Aus- 
trian government commission of inquiry into Voest- 
Alpina artillery shipments to Iran. 

Amiram Nir, counterterrorism adviser to Israeli Prime 
Minister Shimon Peres, was designated in July 1985 as the 
only non- American member of the Vice President's Task 
Force on Combatting Terrorism, headed by George Bush. He 
became heavily involved with Oliver North and Robert Mc- 
Farlane in the Iranian arms-for-hostages deals, and he met 
Bush in Jerusalem in summer 1986. In May 1985, John Poin- 
dexter sent a message to North complaining that Nir was talk- 

64 October 1996 

EIR Special Report 

ing too much about U.S. arms deals for Iran; he wrote: "What 
the hell is Nir doing? We really can ' t trust those sob' s . " 

Nir died in the crash of a light plane in Mexico on Nov. 
29, 1988. The plane in which he was flying was owned by 
Lonrho. Nir had been hired as a consultant by Lonrho chair- 
man Tiny Rowland, and was ostensibly in Mexico, to visit 
avocado farms. There was a likelihood that Nir would have 
been called as a witness in the trial of Oliver North and other 
Iran-Contra defendants, where he could have testified about 
Bush's personal participation in the arms-for-hostages ar- 

Alois Weichselbaumer, an Austrian arms dealer, died in 
Linz on Feb. 8, 1989, allegedly of a heart attack. 

Lakowski, the general director of the Rotterdam office of 
DVIOG, the shipping subsidiary of Alexander Schalck-Golod- 
kowski' s firm Deutrans, died of a sudden heart attack in Feb- 
ruary 1990. 

Uwe Harms, a Deutrans representative, died under mys- 
terious circumstances in February 1 990 in the Hamburg office 
of the Deutrans partner firm Richard Ihle. 

Rashid al Jarrah of Saudi Arabia died in Lugano, Swit- 
zerland on Oct. 12, 1987, hours before he was to be handed 
over by the Swiss to the Italian authorities. His death was 
attributed to heart attack, although he was only 25 years old. 
Al Jarrah was part of an arms-trading ring that operated in 
Italy, Lebanon, and Yugoslavia under the cover of a toy- 
factory, also producing pen- guns. One named associate at 
the time, the Swiss-Hungarian Peter Jenney, who has been 
implicated in the Iran arms deliveries of the Italian company 
Borletti, has never been indicted. 

Col. Gerald Clarke, head of G-2 Army Intelligence for 
the U.S. Southern Command in the Panama Canal Zone, with 
oversight for the entire Caribbean and Central American re- 
gion, died on Feb. 28, 1989. 

Gen. Gustavo Alvarez, chief of staff of the Honduras 
Armed Forces, was killed in early 1989. General Alvarez 
was deeply involved in Contra operations and Contra-related 
drug-trafficking, and was knowledgeable about the opera- 

cartel had him under surveillance. Seal was gunned down on 
the street near the halfway house in February 1986. 

Emile Camp was an expert pilot who flew for Barry Seal, 
and was the only witness to many of Seal' s important transac- 
tions with Colombian drug lords and with U.S. intelligence 
officials. In February 1985, his elaborately equipped plane 
inexplicably ran out of gas on a routine approach into the 
Mena airport, and crashed into the Ouchita Mountains in Ar- 

Steve Carr was a Contra mercenary based at the John 
Hull ranch in Costa Rica who knew too much about drug 
shipments, and who told some of his story to the Miami Her- 
ald in July 1985 . He was found dead in Van Nuys, California, 
on Dec. 1 2, 1 986; press reports said that he had ingested three 
bags of cocaine, although three separate autopsies reported 
otherwise. Carr had told friends and associates that he feared 
for his life, from "Hull's hired guns." Hull himself is reported 
to have threatened another witness, shouting, "The CIA killed 
Steven Carr, and they can do the same to you." 

Robert McFarlane, who was national security adviser 
from 1983 to the end of 1985, attempted to kill himself in 
February 1987, after the public disclosures of the Iran arms- 
for-hostages deals in which he was deeply involved. His at- 
tempted suicide has never been satisfactorily explained, least 
of all by him. Some have suggested that McFarlane was be- 
ing blackmailed. 

Sheikh Salim bin Laden was killed in a plane crash in 
Texas in August 1988. He was a board member of the Bank 
of Credit and Commerce International, the principal financing 
conduit for the Afghanistan War and arms shipments to the 
mujahideen. A prominent Anglophile, he was only one of four 
Saudis allowed to join Prince Philip's "1001 Club," which 
finances the British royal family's World Wide Fund for Na- 
ture. He was a cousin of Osama bin Laden, a principal finan- 
cier of Afghansi terrorists to the present day. 

William Colby. On Saturday, March 27, 1996, former the 
former director of the CIA disappeared, reportedly while boat- 
ing near his weekend cottage on the eastern shore of Maryland. 

Chapter 5 

Paris Review' goes to Kabul 

The potential for a tidal wave of destabilization of all of West, 
Central, and South Asia to arise out of the events of the week of 
Sept. 23, 1996, cannot be underestimated. On Sept. 27, Israeli 
soldiers shot worshippers as they were praying inside the Al- 
Asqa mosque, one of the holiest sites of Islam, in Jerusalem — 
a provocation of the highest order to the entire Islamic world. 
On the other side of the spectrum, the Sunni fundamentalist 
Taliban strode into the capital city of Afghanistan on the very 
same day, and immediately laid down its version of the Islamic 
sharia law, forbidding women to work with men, and requir- 
ing that all males have untrimmed beards; and then proceeded 
to summarily execute, and then drag through the streets, and 
hang on display, the dead bodies of former Afghan President 
MohammedNajibullah andhis brother. 

Among other events, the way was paved for these atroci- 
ties by the strategic assassinations of Israeli Prime Minister 
Yitzhak Rabin and of Indian Prime Minister Rajiv Gandhi 
(see Chapter 4). Both were martyred on the satanic altar of 
those who seek a "clash of civilizations," an armageddon of 
chaos and war in the entirety of Central Asia and environs, in 
their ruthless pursuit for strategic control over that crucial 
region that links Asia to Europe, Africa, and Russia. All the 
central figures of the "explosives cartel" subscribe to the de- 
mand that — instead of the development of Asia, linked to that 
of Russia and China, impelling cooperation among nations 
and peoples — West, Central, and South Asia must become a 
cauldron of war and destabilization unleashed by an orches- 
trated "clash of civilizations." 

Hence, it is not surprising to find the paw marks of the 
likes of John Train or Jimmy Goldsmith, or their Paris Review 
chum Sadruddin Agha Khan, all over areas such as Afghani- 
stan, Pakistan, Uzbekistan, and Tajikistan. Afghanistan 
stands at the center of events that will decide which way all of 
Europe and Asia will go: world war, or peaceful coexistence 
grounded in economic development. 

The Taliban is just the latest of the abominations to 
emerge from the efforts to prolong Afghanistan's civil war — 
blocking the gateway from the Indian Ocean to Central Asia 
and the development of this vast and resource-rich region. 

Already, the Afghan war has reduced the population in- 
side the country from 1 6 million to 9 million people; 5 million 
people have fled the country, and 2 million people have been 
killed, since the war began with the Soviet military invasion 
of Afghanistan in 1979. The Anglo-American covert support 
operations for the Afghan mujahideen (freedom fighters) 

from 1 980 to 1 989, have proven to be an unmitigated disaster. 
The Anglo-American "secret war" in Afghanistan was 
launched by then British Prime Minister Margaret Thatcher 
and Lord Nicholas Bethell in 1980, when the two came to the 
United States to organize groups that would provide funding, 
and logistical and propaganda support for the Afghan muja- 
hideen. John Train's Afghan Relief Committee, organized in 
1980 for the purpose of boosting the prospects particularly of 
Gulbuddin Hekmatyar, was one such outfit. 

The fruits of the Afghan war 

Officially, the U.S. government poured $3 billion into the 
Afghan war, and organized similar large donations from the 
governments of Saudi Arabia, Egypt, Kuwait, and China. Out 
of this effort have emerged these results: 

• The creation of the Golden Crescent of drug production 
and marketing. By the mid-1980s, Bethell' s mujahideen were 
supplying half the heroin consumed in the United States 
alone. Between 1980 and 1989, opium production in the 
Golden Crescent skyrocketted from slightly more than 100 
tons to 2,800 tons. And radiating out of Afghanistan, drugs 
have become big-time business for mafias in the newly inde- 
pendent countries of Central Asia, a business fueled in part by 
the massive expansion of the dope market in eastern Europe, 
Russia, and Central Asia itself. 

• Global money-laundering operations. The covert oper- 
ations that crisscrossed Afghanistan and environs required 
secret banking arrangements. Laundering of drug proceeds, 
and secret accounts for massive and illegal arms deals that 
siphoned off arms officially designated for Afghanistan to 
such locations as Iran or Nicaragua, required a new kind of 
banking. Karachi's Bank of Credit and Commerce Interna- 
tional (BCCI), of Pakistani banker Agha Hasan Abedi, was 
seized upon to fulfill this role. At the point that it was shut 
down by the Bank of England in 1990, BCCI had a total of 
$23 billion swirling around in its myriad global accounts (the 
bulk of which has disappeared). 

• The criminalization of Pakistan. Not only did the grow- 
ing drug production inundate Afghanistan with drugs, but the 
drug flow through Pakistan resulted in the addiction of more 
than 1.3 million people in this country, and the degeneration 
of its major port city, Karachi, into a drug-gangland far more 
dangerous than 1920s Chicago. The mujahideen war in Af- 
ghanistan has spilled across the border into Pakistan — which 
had agreed to serve Anglo-American interests as the forward 

66 October 1996 

EIR Special Report 



MAP 2 

The 'Arc of Crisis' in conflict and war 

Key for Map 2 

Algeria: Since 1992, Algeria has been in a near civil war, 
pitting the government against the Islamic Salvation Front. 
Bloody terrorist actions by the Islamic Armed Group (Gl A), led 
by former Afghan mujahideen, have fueled the fighting. 

Libya: Increasing domestic discontent, including riots in 
1995, have raised questions about the future of the Qaddafi 

Fnunt 1 Rritich-ctooroH "Iclamir" Qtrifo Hnmpri nn .Qnrian 

Israel: Prime Minister Benjamin Netanyahu's promotion 
of Jewish fundamentalist efforts to destroy Islamic holy places, 
is leading toward a new Arab-Israeli war. 

Iran: Iran remains a target of sporadic attacks by the Brit- 
ish-run Mujahideen e Khalq, based in Iraq. It is also faced with 
threats from the West, and from the Taliban in Afghanistan. 

Armenia, Azerbaijan, Chechnya: The war in the Cauca- 
sus region continues, fueled by British and NATO arms sup- 
plies to all sides in the conflict. Afghansi veterans have been 

airiinn the A-701-ic anH P.horhonc 

base for the secret Afghan war. Terrorist incidents are now a 
daily occurrence in Pakistan. 

• The creation of the Afghansi. Even aside from the Tali- 
ban, which consists of regrouped mujahideen and their lead- 
ers, it is believed that the Bush secret war in Afghanistan 
has spawned a mercenary force of some 10,000 "Afghansi," 
armed, trained, and ready for deployment in any location. 
Culled from the ranks of not only Afghans, but the foreign 
mujahideen who came to join them in the war against Mos- 
cow, the "Afghansi" include 5,000 Saudis, 3,000 Yemenis, 
2,000 Egyptians, 2,800 Algerians. Since the beginning of the 
1990s, they have been activated in such disparate areas as 
North Africa, the Arabian Peninsula, China, Kashmir, Bosnia, 
the Philippines, Tajikistan, and New York City. 

The "Afghansi" are to be seen today as a subset of British 
intelligence — no matter what their own beliefs on the matter 
might be. One of the leading training groups operating in 
Afghanistan was the British Army's Special Air Services 
(SAS), and its private security-forces offspring. The most 
notable of these operating in the Afghan theater, is Keenie 
Meenie Services (KMS), which was among the agencies 
training the mujahideen. 

Today, this deployable force of Afghansi finds safe haven 
notably in two places: Afghanistan itself, and London, as EIR 
has documented, and as the governments of Israel, France, 
Pakistan, and Egypt, victims of Afghansi terror, have all com- 
plained loudly at various times over the last two years. 

The set-up 

From the standpoint of U.S. national strategic interests, 
it is difficult to imagine a more catastrophic operation than 
George Bush' s secret war in Afghanistan. The deployment of 
the Taliban now inside Afghanistan — a venture believed to 
be aided by sections of the U.S. military — is a harbinger of 
permanent destabilization in the region. The underlying mo- 
tive of this venture was scripted in London, by the hand of 
British intelligence agent Bernard Lewis, who conjured up 
the plan that the nations of West and South Asia should be 
carved up into many ethnic "stans" — to be subsumed under 
overall imperial rule, on the model of the Roman Empire. In 
1992, Lewis updated his thoughts in the New York Council 
on Foreign Relations magazine Foreign Affairs, predicting 
the "Lebanonization" of all of Central Asia reaching into the 
Indian subcontinent. 

In the United States, this policy was sold in the late 1 970s, 
under the rubric of the "Arc of Crisis." The idea was to ignite 
the flames of ethnic and religious conflict all along the south- 
ern-tier border of the Soviet Union. As Carter National Secu- 
rity Adviser Zbigniew Brzezinski said in motivating U.S. sup- 
port for the Khomeini revolution in Iran in 1979: "Islamic 
fundamentalism is a bulwark against communism." 

However, despite the collapse of Soviet communism, and 
despite the disastrous results of this policy, as carried out in 
Afghanistan, for the United States and its allies, the policy re- 

mains in full force. This is because the policy is consistent with 
the geopolitical goals of British intelligence, operating for the 
financial oligarchy. It is also because it is enforced as U.S . pol- 
icy through a "fifth column" of British agents of influence op- 
erating inside Washington's permanent bureaucracy in the 
State Department, the Pentagon, and leading stateside think- 
tanks. That' s where George Bush and friends come in. 

The Afghan Relief Committee 

John Train, an operative for British intelligence empow- 
ered with top-level connections in the United States, was in 
on the Afghan policy from the ground floor, with his 1980 
creation of the Afghan Relief Committee (ARC). The ARC 
was housed in Train's investment consulting office in New 
York City. Train was ARC's president, and, according to a 
1980 Washington Post article, "its financial whiz." ARC's 
stated purpose was to raise "seed money" for medical organi- 
zations treating casualties among the mujahideen. After re- 
ceiving the Relief Committee's seed money, the medical or- 
ganizations were expected to go elsewhere for financing. 

The main known financial beneficiaries of the group were: 

• Doctors Without Borders, run by Ronny Brauman in 
Paris. This organization, whose most prominent representa- 
tive was Danielle Mitterrand, wife of President Francois Mit- 
terrand of France, also received money from the National 
Endowment for Democracy. 

• Freedom Medical of Washington, D.C. 

• Aide Medicale International. 

• Sainte Sud of Marseilles. 

Most money to such groups, although not these specifi- 
cally, originated with the International Rescue Committee or 
Relief International. The first two listed received almost all 
of ARC's funds. 

But the nature of other organizations associated with 
Train's ARC belies any notion that ARC was merely a rescue 
operation. ARC was interfaced with Leo Cherne's Interna- 
tional Rescue Committee (IRC), whose Peshawar-based of- 
fice was staffed mostly with Hekmatyar' s gang; the National 
Endowment for Democracy (NED); and the State Depart- 
ment's Agency for International Development. Cherne was 
then vice-chairman of the President's Foreign Intelligence 
Advisory Board (PFIAB), with offices at the White House, 
where George Bush was gathering the reins of all intelligence 
activities into his own hands. 

Founders of the ARC, in addition to Train, included four 
former U.S. ambassadors to Afghanistan: Francis L. Kellogg, 
a decades-long associate of Train from the prominent grain- 
interest family; Train's cousin Sen. Claiborne Pell (D-R.L); 
and professors Louis Dupree and Thomas Gouttierre, both 
Afghan hands. Jeane Kirkpatrick, later the Reagan adminis- 
tration ambassador to the UN, was co-chairman of the group. 

ARC's on-the-ground operations (like those of many 
other western organizations) were based in Peshawar, Pa- 

68 October 1996 

EIR Special Report 


& ^ f .-«*^i 


■•-r : >l&3s? 



Another 'humanitarian' 

After the Soviets had been forced out of Afghanistan, 
rescue operations were passed to Sadruddin Agha Khan, a 
tennis partner of George Bush, and a close friend of both Train 
and Goldsmith from their early days in Paris. 

At the point of the Soviet pullout, Agha Khan was named 
special coordinator for the UN Humanitarian and Economic 
Assistance Programs relating to Afghanistan, in what was 
code-named Operation Salam. It has long been suspected that 
under cover of such "relief operations, the protracted civil 
war that ensued in Afghanistan was organized and supplied — 
on both sides. 

Additionally, since Operation Salam was officially in- 
tended to organize the repatriation of Afghan refugees, it also 
oversaw the dispersal of Afghan war veterans and refugees 
throughout the world — that is, it was in a key position to 
oversee the early birth of the rootless "Afghansi." 

Sadruddin Agha Khan, of course, has always been active 
in Pakistan, given that his grandfather was one of the founding 
fathers of the Muslim League that forced Pakistan's creation. 
Here, his Ismaili followers have been swarming into the area 
of Chitral in northern Pakistan, and the nearby regions of 
Gilgit and Hunza, adjacent to Indian Kashmir. The region of 
Chitral is renowned for the quality and abundance of its opium 
poppy, and was a smuggling depot for the Afghan mujahi- 
deen. But more recently, Agha Khan' s followers have formed 
an alliance with the British- steered Kashmiri independence 
movement, which seeks to create a new Kashmir out of the 
territories of both India and Pakistan. Agitation is arising in 
Gilgit that the area should become an independent state. 

Sadruddin Agha Khan is also directly associated, through 
his followers, with the opposition in Tajikistan that is based 
in the Pamir Mountains. The Konduz and Takhar refugee 
camps in northern Afghanistan, which are inhabited by clan 
refugees from the Garm, Pamir, and Badakhshan regions of 
Tajikistan, are the staging grounds for guerrilla activities 
within Tajikistan. A large portion of the Badakhshani and 

Jomir ofo 

il ir\ A rrV\ r. 

it» «v*Tiirrao 

following the exploits of his cohorts Train and Agha Khan 
in the region, is linked to the sustenance operations for the 
Taliban, which reportedly has ties to Britain. 

Whatever it is that has brought Jimmy Goldsmith to Paki- 
stan, it must be important, for on June 21, 1995, it was an- 
nounced that his daughter, Jemina Goldsmith, had married 
the Pakistani cricket-playing legend Imran Khan. Jemina, a 
close personal friend of Princess Diana, whom she later 
hosted in Pakistan, had been swiftly married to Imran, after 
he unceremoniously unloaded another British heiress. 

After retiring from cricket, Imran Khan had become the 
political protege of Hamid Gul, former chief of the Pakistani 
Interservices Intelligence (ISI), who had organized rallies for 
Imran Khan and his Movement for Justice, on the platform of 
creating a new Islamic political force in Pakistan. Hamid Gul 
is believed by numbers of knowledgeable sources in the re- 
gion, to be the "hands-on" coordinator of the wide-roaming 

One might not expect James Goldsmith to be involved 
with such operations. However, in 1990, Goldsmith acquired 
Kilo Alpha Services (KAS), one of the spin-offs of SAS run 
by former SAS Counter- Terrorism Warfare team leader Lt. 
Col. Ian Crooke. Crooke's brother Alastair was the British 
deputy consul in Peshawar, Pakistan. 

On Oct. 17, the London Daily Telegraph correspondent 
from Lahore reported that Goldsmith had made a decision 
to personally bring down the government of Prime Minister 
Benazir Bhutto through "corruption scandals." The Daily 
Telegraph is owned by the Hollinger Corporation, on the 
advisory board of which Goldsmith sits. 

According to the Telegraph, Goldsmith's son-in-law is 
"preparing to file corruption charges against Pakistan' s Prime 
Minister Benazir Bhutto and her husband, Asif Ali Zardari." 
Khan is "consulting his lawyers, about filing charges in the 
Supreme Court, against Mrs. Bhutto' s alleged corruption. Im- 
ran has accused the couple, of buying several properties in 
London and the Home Counties, charges the PM denies. . . . 

T act mr\nth Tmran t*^tnm«iri fV/^m T r-vr\rl/^r» oi-»rl mrtorle* TMiV^lii^ 

Major terrorist incidents 
since Clinton's inauguration 

Jan. 25, 1993, U.S.A.: Two officials shot to death outside 
CIA headquarters in Langley, Virginia, allegedly by a Paki- 
stani involved in Afghanistan. 

Feb. 26, 1993, U.S.A.: Six killed in truck-bombing at 
World Trade Center in New York City ; several former Afghan 
mujahideen are later convicted for the incident. 

March 12, 1993, India: Two hundred killed in several 
simultaneous bombings in Bombay, reportedly by Hezbollah. 

Feb. 25, 1994, Israeli occupied territories: Jewish De- 
fense League official Baruch Goldstein kills 50 worshippers 
at the Tomb of the Patriarchs mosque in Hebron. 

July 18, 1994, Argentina: Buenos Aires headquarters of 
the Argentine-Israeli Mutual Association is destroyed by a 
car- bomb, killing over 100. 

Sept. 12, 1994, U.S.A.: Stolen Cessna plane crashes on 
White House lawn, killing pilot, Frank Corder. 

Sept. 21, 1994, Algeria: First Armed Islamic Group 
(GIA) assassination of foreigners — two Frenchmen — in Al- 

Oct. 29, 1994, U.S.A.: Francisco Duran sprays White 
House with semi-automatic assault weapon fire. 

Dec. 12, 1994, U.S.A: High-powered rifle fired at White 
House windows. 

Jan. 30, 1995, Algeria: GIA car-bombing outside Algiers 
police station kills 42. 

March 8, 1995, Pakistan: Two employees of U.S. con- 
sulate in Karachi are murdered. 

March 20, 1995, Japan: Nerve gas released in a Tokyo 
subway kills 10 and injures more than 4,500, the first of a 
series of such attacks. Members of the Buddhist Aum sect, 
linked to the Dalai Lama of Tibet, are later convicted of the as- 

April 19, 1995, U.S.A.: Truck-bombing of U.S. Federal 
Building in Oklahoma City kills 168. 

July 19, 1995, France: Abdelbaki Sahraoui, a founder of 
the Algerian Islamic Salvation Front, is assassinated by GIA 
in Paris. 

July 25, 1995, France: GIA bombing at St. Michel Metro 
station in Paris. 

Aug. 17, 1995, France: GIA bombing at Metro station 
Place de l'Etoile, Paris. 

Aug. 26, 1995, France: Media Natura, a spin-off of 
Prince Philip' s World Wildlife Fund, issues video death threat 
to President Jacques Chirac, which is disseminated world- 
wide via the Internet. 

Aug. 26, 1995, France: Failed GIA bombing of Paris- 
Lyons high-speed train. 

Sept. 3-4, 1995, France: Bomb attempt against Richard 
Lenoir Marketplace, in Paris, followed by bomb attempt at a 
market in 15th Arrondissement. 

Nov. 2, 1995, Colombia: Alvaro Gomez Hurtado, a 
prominent Conservative Party leader in the fight against 
narco-terrorism, slain by four gunmen in Bogota. 

Nov. 4, 1995, Israel: Israeli Prime Minister Yitzhak 
Rabin assassinated in Tel Aviv. 

Nov. 13, 1995, Saudi Arabia: Five U.S. soldiers, and two 
others, killed by a car-bomb at a U.S. military training center 
in Riyadh. Three of the four Saudi nationals later executed 
for the bombing were Afghan mujahideen. 

Nov. 19, 1995, Pakistan: Car-bombing of Egyptian em- 
bassy in Islamabad completely destroys building. 

Feb. 9, 1996, United Kingdom: London bombing attrib- 
uted to the IRA. 

Feb. 25, 1996, Israel: Suicide bombing on Jerusalem bus 
kills 25. 

March 3, 1996, Israel: Suicide bombing, claimed by 
Hamas, kills 20 passengers on Jerusalem bus. 

March 4, 1996, Israel: Suicide bombing in Tel Aviv 
shopping market kills 13. 

June 25, 1996, Saudi Arabia: Truck-bomb at Dhahran 
U.S. military barracks kills 19 U.S. soldiers. 

July 14, 1996, United Kingdom: Car-bombing at En- 
niskillen hotel attributed to IRA, triggers week of rioting in 
Northern Ireland. 

July 17, 1996, U.S.A.: TWA 800 flight explodes over 
Long Island, New York, killing 230. 

July 27, 1996, U.S.A. : Pipe-bomb at Olympics in Atlanta, 
Georgia kills two. 

Sept. 20, 1996, Pakistan: Murtaza Bhutto, brother of 
Prime Minister Benazir Bhutto, shot dead in Karachi, after 
his bodyguards reportedly opened fire on the police. 

70 October 1996 

EIR Special Report 


Bush-Thatcher 'secret government' 
operations: 1979-96 

Following is a compilation of the most significant events re- 
lated to the international arms cartel and the Bush-Thatcher 
"secret government" apparatus in the 1979-96 period. It is 
by no means complete, and obviously cannot report many of 
the most important events which took place behind closed 
doors, and which may never find their way into the public eye. 
Nevertheless, it serves to situate, in time and context, those 
known events which are chronicled in this Special Report. 

1979 ~ 

Jan. 15: Time magazine cover story, "Crescent of Cri- 
sis — Troubles Beyond Iran" features National Security Ad- 
viser Zbigniew Brzezinski's claim: "An arc of crisis stretches 
along the shores of the Indian Ocean." The Time feature pro- 
motes using Islamic fundamentalist upsurges against the So- 
viet Union. 

Jan. 16-Feb. 1: Shah of Iran leaves the country, Ayatollah 
Khomeini takes over. 

June- July: Somoza flees Nicaragua, Sandinista govern- 
ment takes over. 

November:: U.S. Congress passes arms embargo 
against Iran. 

Dec. 27: Soviets invade Afghanistan. 


*70» T T C Cfafp rionQrfmpnr cpn/lc fl ^qKIp (■a t^a A m^r. 

military equipment goes to Iran. 

Sept. 8: Iranian gun-runner Cyrus Hashemi sues EIR and 
other publications for exposing his role as financier of Iranian- 
sponsored terrorism. 

Sept. 10-20: Iranian envoy Sadegh Tabatabai meets with 
U.S. and German officials in West Germany on hostage crisis. 

Sept. 22: Iraq attacks Iran, beginning eight-year-long 
Iran-Iraq War. 

Oct. 2: George Bush predicts the Carter administration 
will produce an "October Surprise." 

November: There is much discussion of a "Kissinger 
comeback," and that he will get post in new administration. 

Nov. 4: Reagan-Bush ticket elected in U.S. general elec- 

Nov. 16: Sweden's Prime Minister Olof Palme in U.S. 
for meetings at UN on the Iranian hostage crisis. 

Dec. 10: Cyrus Hashemi and his lawyer/business partner 
Stanley Pottinger are overhead on FBI wiretaps discussing 
illegal shipments of military equipment to Iran, using British 
and Swiss shell companies. 


Early 1981: The "Committee for a Free Afghanistan" is 

Head Crisis Management." 

March 30: President Reagan wounded in unsuccessful 
assassination attempt in Washington. 

May 13: Pope John Paul II wounded in unsuccessful as- 
sassination attempt in Rome by Mehmet Ali Agca. 

May 20: An expose of the role of the illegal Italian Free- 
masonic Lodge, Propaganda-2, reveals its involvement in 
criminal activities, including "right-wing" bombings and as- 
sassinations all across Europe. The expose provokes many of 
Europe's prominent politicians, military officers, and intelli- 
gence chiefs to resign. 

July: Under the Reagan-Bush National Security Council 
structure, the Senior Interagency Group (SIG) reportedly ap- 
proves third-party arms sales to Iran. 

Nov. 17: Reagan signs NSDD-17, authorizing covert sup- 
port for Contras. 

November: CIA sets up joint U.S.-Saudi bank account in 
Switzerland for arming the Afghan resistance, as quid pro 
quo for U.S. sale of AW ACS to Saudi Arabia. 

Dec. 4: President Reagan signs Executive Order 12333, 
which 1) puts all "foreign intelligence" operations under the 
NSC; 2) allows agencies other than CIA to conduct "special 
activities" (covert operations), and 3) allows use of private 
contractors for intelligence operations. 

Dec. 14: National Security Decision Directive Number 3 
(NSDD-3) on "Crisis Management" is signed, which makes 
the vice president chairman of the Special Situation Group. 

1982 __ 

Jan. 12: NSDD-2 formalizes NSC structure, with Senior 
Interagency Groups (SIGs) for foreign policy, defense policy, 
and intelligence. 

Jan. 28: Bush is put in charge of South Florida Task Force 
on drugs. 

March 8: The New York Times reports that Iran has re- 
ceived $100-200 million in arms shipments from Europe in 
the preceding 18 months. 

Spring 1982: Large orders from Iran for gunpowder and 
other explosives are made to the explosives cartel. 

April 10: President Reagan signs NSDD-30, "Managing 
Terrorist Incidents," gives Bush control over the convening of 
the SSG, and creates the "Terrorist Incident Working Group" 
(TIWG) to support the SSG. 

May 14: "Crisis Pre-Planning" memorandum is issued 
by NSC, which establishes a standing Crisis Pre-Planning 
Group (CPPG) under the Special Situation Group. The SSG- 
CPPG, under Bush, is given control of any area in which a 
potential crisis could emerge. 

August: Donald Gregg resigns from the CIA to become 
Vice-President Bush's national security adviser. In July, 
Gregg had recommended that CIA officer Walter Raymond 

be posted to the NSC. 

Aug. 17: Nobel Industries marketing chief Mats Lund- 
berg meet some "Iranians" in London; a second meeting takes 
place on Sept. 28. 

Aug. 19: A "Dear Bill" letter from former U.S. Secretary 
of State Henry Kissinger to FBI Director William Webster 
asks to have the FBI look into LaRouche and his group. 

Fall 1982: Olof Palme is elected prime minister of 

Nov. 10-15: Soviet leader Leonid Brezhnev dies; Yuri 
Andropov chosen as successor. 

Dec. 8: U.S. House of Representatives passes first Boland 
Amendment, restricting military aid to Contras. 

Throughout 1982-83: A faction within the National Se- 
curity Council, led by Walter Raymond, Roy Godson, and 
Kenneth DeGraffenreid, and identified with the Public Diplo- 
macy project, demands that Reagan administration officials 
sever contact with LaRouche and EIR. 


At some point in 1983: The AB Bofors company intro- 
duces Karl-Erik Schmitz to individuals in the explosives divi- 
sion of Gechem SA in Brussels; Gechemis Belgium's largest 
powder-maker, known in the industry as PRB. 

January: President Reagan signs NSDD-77, entitled 
"Management of Public Diplomacy Relative to National Se- 

Jan. 8: Sadegh Tabatabai is arrested at the Dusseldorf, 
Germany airport with raw opium in his suitcase; on the same 
day, American businessman George Perry, involved in arms 
deal with Tabatabai, disappears. Perry's body is found three 
months later in a lake in near New York City. 

Jan. 12: At a meeting of the President's Foreign Intelli- 
gence Advisory Board, David Abshire and Leo Cherne ask 
whether the FBI has a basis to investigate LaRouche "under 
the guidelines or otherwise." A question is raised whether 
LaRouche might be funded by "hostile intelligence agencies." 
By February, a probe of LaRouche is on. 

March 3: NSC staffer Walter Raymond recommends the 
President meet with a group of potential funders of "public 
diplomacy" efforts. On March 21, President Reagan meets 
with Jimmy Goldsmith, Carl Lindner, Rupert Murdoch, John 
Kluge, and George Gallup, among others. They are told that 
Dwayne Andreas of Archer Daniels Midland, and David 
Rockefeller are already "on board." 

March 23: LaRouche' s proposal for a new military doc- 
trine is adopted by President Reagan when he announces the 
Strategic Defense Initiative (SDI) in a nationwide TV ad- 

Mid-April: First known John Train salon meeting is held 
to coordinate a national media vilification campaign against 

72 October 1996 

EIR Special Report 


> *^.i 


LaRouche, and to promote federal investigations against him. 
About 25 journalists attend, including NBC-TV producer 
Pat Lynch. 

April 18: U.S. Embassy in Beirut is bombed, killing at 
least 33 people. 

May: U.S. Secretary of State George Shultz loses fight 
over Public Diplomacy; the NSC and Bush' s SSG are placed 
between the President and secretary of state in the line of au- 

September: Nobel's Lundberg visits Iran to make plans 
for export. 

October: Richard Secord and Albert Hakim create Stan- 
ford Technology Trading Group International as an interna- 
tional arms-trading company, with bank accounts and shell 
companies managed by Willard Zucker at Compagnie de Ser- 
vices Fiduciaires (CSF) in Geneva. These companies become 
known as "the Enterprise." 

Oct. 23: Terrorist bombing kills 237 at U.S. Marines bar- 
racks in Beirut, Lebanon. 

1984 __^_ 

Throughout the 1980s: Bofors exports explosives and 
armaments to Iran and Iraq, aided by the East German com- 
pany Berliner Import-Export. 

During 1984: President Reagan appoints John Train to 
the board of the African Development Foundation. 

Duing 1984: Bofors hires Karl-Erik Schmitz. 

January: U.S. Embassy in Bonn circulates the line that 
LaRouche and EIR are KGB-funded. Pat Lynch, with a cam- 
era crew, appears at EIR 's Wiesbaden office. 

March 4: NBC-TV's "First Camera" airs a 20-minute 
slander on Lyndon LaRouche, with allegations of CIA connec- 
tions. The broadcast targets Reagan administration officials 
who have been working with LaRouche on the SDL Wire sto- 
ries carry the NBC slanders across the nation. The next day, 

Bush, at the National Press Club, 1988. As Vice President, Bush 
ran the Special Situation Group, and a number of other White 
House secret units that directed the not-so-secret wars in Central 
America, Afghanistan, and Africa. Bush was in charge of the 
operations that flooded the United States with cocaine and heroin 
during the 1980s, in order to generate "private sector" funds for 
the "freedom fighters. " 

Sept. 6: Schmitz is introduced to the explosives cartel 
through Mats Lundberg. 

Sept. 8 and 14: Lundberg visits Iran and Pakistan to ar- 
range secret transport of explosives to both countries. 


December: Secord and Clines make first arms shipment 
to Contras from China, worth $72,400, through Defex in Por- 

Throughout the mid-1980s: The Anglo-American "se- 
cret war" in Afghanistan is funded, and receives logistical 
and propaganda support through John Train's Afghan Relief 
Committee, which is coordinated with Britain's Margaret 
Thatcher and Lord Nicholas Bethell. During this period, half 
the heroin consumed in the U.S. is produced in the Golden 
Crescent, and there is a massive expansion of the drug market 
in eastern Europe, Russia, and Central Asia. 


January: Secord and Clines make second shipment of 
arms to Contras from Defex in Portugal. 

January: Karl-Eric Schmitz receives an order for explo- 
sives from Iran via Pakistan. 

January: A French explosives-smuggling ring into South 
Africa is busted, and a Swede, Tom Rosenberg, is arrested in 
Stockholm for his role as "consultant" to the ring. He had 
hired Danish ships for the cartel. The bust is said to have 
precipitated the murder of French Gen. Rene Audran. 

Jan. 18: Bofors/Nobel Explosives seeks and gets the per- 
mission to export explosives worth $41 million to Pakistan, 
to WAH-NOBEL, which in reality is to go to Iran. 

Jan. 26: Gen. Rene Audran of France is killed by Action 
Directe terrorists. He was an engineer of armaments and head 
of the international section of the French Defense Ministry. 

February: Emile Camp, an expert pilot for DEA-CIA 
informant Barry Seal, and witness to many of Seal's drug 
deals and intelligence contacts, is killed when his plane inex- 
plicably runs out of fuel, and crashes into Ouachita Mountains 
near Mena, Arkansas. 

February: London' s Arbuthnot Latham Bank, owned by 
Erik Penser, is engaged to transfer money from Iran to Bofors 
in the "Pakistanian" explosives deal. 

March: Secord and Clines make third arms shipment to 
Contras from Defex in Portugal. Value of second and third 
shipments is $1 .2 million. 

March 10: Swedish Prosecutor Stig Age starts an investi- 
gation into Bofors for arms smuggling to Bahrain and Dubai. 

March 20: Police raid Bofors offices. 

March-May: Secord and Clines arrange fourth shipment 
of arms worth $6.4 million to Contras, using the Danish 
freighter, Erria, which they later purchase. 

April: President Reagan signs NSDD-166 directing the 
CIA to drive the Soviets from Afghanistan "by all available 

April: Al Taqrir, an Arabic newsletter published in Lon- 
don, writes "Iran soon will import RBH-70 [missiles] from 

April: Bahrain apparently orders 879 (or possibly 1,279) 
RBH-70 missiles from Bofors. 

April 17: The Bofors offices are searched by police. 

June: North and Secord meet with Contra leaders in Mi- 
ami, tell them that private contributions will go directly into 
"Enterprise" accounts, rather than to the Contras, enabling 
the "Enterprise" to corner the Contra arms market. 

June 5 : It is revealed that the Swedish customs authorities 
believe that Bofors/Nobel is smuggling arms and explosives 
to Syria, Egypt and Iran. 

June 10: Palme discusses the Indian howitzer deal with 
Indian Finance Minister V.P. Singh. Answering a question 
from Singh on the Bofors smuggling business, Palme says, 
"Bofors apparently has been fooled." 

June 13: The Swedish customs stops 600-ton gunpowder 
shipment destined to Pakistan worth $41 million. 

June 13: The Swedish government prohibits Bofors to 
export the powder from the Bofors/Nobel company to Paki- 
stan and Yugoslavia after they find that the powder was meant 
for Iran. 

June 13: The Bofors application for permission to export 
720 RBH-70 missiles to Pakistan is rejected by the Swedish 
government. All future export to Pakistan of explosives and 
RBH-70s is prohibited, and the export of guns to Indonesia is 
also stopped. 

June 19: Bofors/Nobel has to cancel orders to Iran for 
explosives, worth more than $158 million. 

June 20: Directors at Bofors are worried due to the prohi- 
bition imposed the week before, and fear the company will 
collapse by the next winter. 

June 21: The Swedish ambassador in India writes to 
Palme that the Indian government demands that no middle- 
men be involved in the Indian howitzer deal. 

July: U.S. Vice President's Terrorism Task Force is cre- 
ated, headed by Bush. 

July: Discussions among oilman John Shaheen, CIA head 
William Casey and CIA Near East operations head Tom 
Twetten about Hashemi' s efforts to mediate negotiations over 
U.S. hostages in Lebanon. 

July: A high-level "committee" meets to discuss how to 
prevent the financial collapse of Bofors, due to the cancelled 

July 11: Herbert Army, Austrian ambassador to Greece, 
dies, reportedly of a heart attack. He has just testified before 
a commis sion of inquiry in Vienna that he knew of guns being 
sold to Greece by the Austrian company Voest-Alpina, and 
being channelled to Iran. 

July 24: As a part of the Schmitz explosives export for 
the cartel, a Boeing 707 from the CIA owned Santa Lucia 
Airways is sent to Iran from France with 22 tons of explosives. 

August: Tiny Rowland finances a $7.5 million arms ship- 
ment to Iran. 

Aug. 14: Schmitz flies 1 1 .4 tons of explosives to Iran 
aboard another Boeing 707 from Santa Lucia Airways, with 

74 October 1996 

EIR Special Report 

help from Belgian businessman Andre Braet, who works for 
Transammo in Belgium. 

Aug. 20: Israel exports 96 TOW missiles to Iran as part 
of the U.S. arms-for-hostages deal, with "bridge" financing 
from Adnan Khashoggi. Iran had rejected first shipment. 

September: Schmitz helps PRB to export explosives pur- 
chased from Royal Ordnance Factories in England, which in 
turn "bought" them from the German Dynamit Nobel. These 
shipments continue until September 1986. 

Sept. 3: Bofors starts to produce howitzers for India, even 
though they don't have the order yet. 

Sept. 8: Dagens Nyheter reports that between May and 
June, Stockholm customs officials seized 50 tons of gunpow- 
der shipped by the Bofors-Karlskoga factory, reportedly des- 
tined for Iran. 

Sept. 14-15: Israel exports 408 more TOW missiles to 
Iran, making a total of 504, after negotiations in Paris involv- 
ing Manucher Ghorbanifar, Michael Ledeen, David Kimche, 
and others. 

Sept. 18: Swedish elections. Palme wins the election, but 
with a small margin. 

Sept. 29: Swedish customs officials raid the Malmo of- 
fices of Karl-Erik Schmitz, and seize thousands of pages of 
documents which detail a global arms and munitions cartel 
operating on both sides of the Iron Curtain. 

October: Prime Ministers Olof Palme and Rajiv Gandhi 
meet in New York during the UN General Assembly. Gandhi 
assures Palme that Bofors will get a contract with the Indian 
government if no middlemen are used. 

November: AE Services, run by former British Army 
Maj. Robert Wilson, is contracted by Bofors to get a deal 
signed by March 1986 with the Indian government. 

November: Rumors claim that Olof Palme stopped a 
shipment of 18 howitzers to Iran (through Singapore). 

November: Israel sells 18 Hawk missiles from U.S. to 

Nov. 11: CIA memo says that U.S. government agencies 
"must not touch" Hashemi, who is under an extradition order, 

December: Palme tells Bofors that they will get permis- 
sion to export the RBH-70s to Pakistan. 

December: Secord and Hakim arrange fifth arms ship- 
ment to Contras. 


January: Soviet English-language edition of New Times 
publishes an attack on Olof Palme. 

January: U.S. decides to sell weapons directly to Iran, 
eliminating Israel as middleman, and using Secord-Hakim 
instead. President Reagan signs covert-action finding on Jan. 
17 authorizing the sales. 

January: North and Secord negotiate sale of 4,000 TOW 
missiles to Iran. 

Early January: Tiny Rowland, officials of Britain' s Tory 
Party, and a representative of East Germany intelligence's 
arms merchant, Alexander Schalck-Golodkowski, the head 
of IMES company, meet in London to extend joint British- 
East German "commercial" operations across southern 

Mid- January: Weld' s Boston federal grand jury expires, 
returning no indictments against LaRouche or any of his asso- 

Jan. 15-23: Palme visits Rajiv Gandhi and assures him 
that the Indian government' s demand that there be no middle- 
men in the Bofors contract, will be met. 

Jan. 17: President Reagan agrees to export weapons di- 
rectly to Iran. 

February: Vice President's Terrorism Task Force issues 
report, creating the Operations Sub-Group (OSG) and a per- 
manent counter-terrorism office located in the NSC staff, 
headed by Oliver North. 

February: Barry Seal, sent by Bush's Drug Task Force 
to DEA as informant, is murdered in Baton Rouge, Louisiana. 

Feb. 7: Arms dealers and middlemen tell Cyrus Hashemi 
that Vice President Bush has approved their arms sales to Iran. 

Feb. 25: Olof Palme finally blocks the sale of Bofors 
weapons to Iran. 

Feb. 25: Reportedly, a telegram is sent from P-2 lodge 
head Lucio Gelli, to U.S. Republican Party official Philip 
Guarino, which reads: "Tell our friend Bush that the 'Swedish 
tree' should be felled." 

Feb. 25: Ollie North and CIA official Tom Twetten meet 
with Iranians in Frankfurt, Germany, and agree that if U.S. 
provides TOW missiles to Iran, Iran will pass some of them 
on to the Afghan mujahideen. 

Feb. 28: Swedish Prime Minister Olof Palme is assassi- 
nated in Stockholm. 

Feb. 28: Bofors sends the first RBH-70s to Pakistan. 

February-May: The "Enterprise" receives $860,000 for 
Contra arms shipments. 

March: Retired CIA officer George Cave suggests to CIA 
Director Casey that profits from arms sales to Iran could be 
used "to fund support for the rebels in Afghanistan. We could 
do the same with Nicaragua." 

March 1: Soviet Central Committee member Georgi Ar- 
batov, a cofounder of the Palme Commission and head of 
Moscow' sU.S.A.-Canada Institute, tells Swedish journalists, 
"I do not know who killed Palme, but I know all too well who 
hated him. . . ." 

March 2: Soviet dailies Pravda and Izvestia write that 
"right-wing circles" and "Western circles" are responsible for 
Palme' s murder. 

March 3: East German Stasi officer Herbert Brehmer, 
and Stasi' s disinformation unit, Department X, are assigned 
to plant false tracks in the hunt for Palme' s murderer. Brehmer 
later says, "At my desk, I drew up the outlines of how the 
EAP theory [LaRouche' s Swedish co-thinkers] would be con- 
duced into the Swedish police investigation." 

March 3: Ekstra Bladet, Denmark's largest tabloid, 
claims, "Sources in the police leadership reveal they are look- 
ing intensely at right-wing extremist groups, such as the 
Swedish neo-Nazis and the so-called European Labor Party 
[EAP]" The reporter says the article is based on a manuscript 
shown to him by Bonnier family' s Expressen. 

March 4: Expressen, Sweden's largest daily, writes that 
the EAP is "known for hate propaganda against Olof Palme," 
and is on a list of suspects under investigation by the Security 
Police (SAPO). The newspaper also carries an article on this 
date authored by Georgi Arbatov titled, "Palme Hated by 

March 12: Viktor Gunnarsson is arrested as a suspect in 
the Palme murder, and is alleged to have ties to the EAP. 

March 12: PRB exports 840,000 detonators to La Era- 
presa Nacional Santa Barbara in Spain, and then on to Iran. 

March 13: At a meeting between Bofors officials and 
Swedish export control office head Carl-Fredrik Algernon, 
Bofors is told "the political unit of the Swedish Foreign Minis- 
try is about to change its policy towards the Gulf states." 

March 16: The Swedish government is informed that 

they will get the order from Iran for 410 howitzers. 

March 18: Two LaRouche Democrats win Illinois state- 
wide primary elections. 

March 18: NBC's Pat Lynch calls the CIA to report "that 
a member of Lyndon LaRouche 's organization is being ac- 
cused of involvement in the murder of Sweden' s Prime Minis- 
ter Palme." 

March 18: EIR also calls the CIA to inform them that 
news reports in Sweden show that EIR and the CIA are targets 
of what EIR identifies as a "Soviet disinformation campaign." 
CIA's response is, "We cannot find anyone here interested in 
talking to EIR. We, of course, would vehemently deny that 
CIA had any connection with Palme's assassination." 

March 18: By nightfall, an NBC Nightly News segment 
accuses LaRouche of complicity in Palme assassination. ADL 
national fact-finding director Irwin Suall tells interviewer, it 
is "not inconceivable" that someone connected to LaRouche 
could have killed Palme. 

Mid-March: The Alexandria, Virginia U.S. Attorney's 
Office and FBI open their own investigation of LaRouche 

March 19: At a press conference at 3:30 p.m. in Stock- 
holm, Swedish Police Chief Hans Holmer announces that the 
circumstantial basis to hold Gunnarsson has collapsed, and 
he is being released. 

March 19: Washington Post story, "Suspect in Palme 
Case Had LaRouche Party Tie: Swedish Group Says Link 
Was Cut in '85," reports, "The 32-year-old man arrested in 
connection with the assassination of . . . Olof Palme was for- 
merly an activist with a Swedish political group affiliated with 
right-wing U.S. presidential candidate Lyndon H. 
LaRouche Jr. . . ." 

March 20: Fighting breaks out on the Pakistani-Indian 

March 21: Moscow' s TV news broadcast "Vremya," airs 
a segment on LaRouche, tagging him and his associates "pro- 
fascist," "terrorist," and "trained killers," who "have received 
special training under the supervision of cutthroats from the 
neo-Nazi private army of the Hoffman [German gun club]." 

March 24: Bofors signs contract with India for delivery 
of 410 howitzers. 

Late March to November: Approximately 20,000 
"news" items appear in American newspapers or on TV, de- 
faming and vilifying LaRouche and his political movement. 

March 25: On the Phil Donahue TV show, ADL's Irwin 
Suall claims LaRouche has infiltrated the U.S. defense and 
military establishment for the purpose of obtaining military 
information to give to the Soviets. He repeats the claim that 
LaRouche is tied to the Palme murder. 

Spring: North negotiates sale of 240 Hawk missile spare 
parts to Iran, and a deal for Israel to buy 508 U.S. TOW 
missiles to replace those shipped to Iran in August-Septem- 
ber 1985. 

April 2: TWA bombing in Athens. 

76 October 1996 

EIR Special Report 

April 4: Ollie North memo to John Poindexter, says that 
they have discussed with the Iranians what assistance the 
Iranians can provide to the Afghan resistance. North writes: 
"May be of real value for Iran and U.S. to find ways to cooper- 
ate against Moscow in Afghanistan." 

April 5: West Berlin discotheque frequented by Ameri- 
can servicemen is bombed. 

April 6: The Paris offices of EIR and the European Labor 
Party (POE) are bombed. 

April 7: The POE receives a letter from the terrorist 
"Black War" organization, claiming responsibility for the 

April 7-8: NBC News features FBI and ADL informant 
Forrest Lee Fick alleging that a LaRouche associate told him 
of a plot to assassinate Henry Kissinger. 

April 8: Bombing attempt near the Bangkok hotel where 
U.S. Secretary of Defense Caspar Weinberger is staying. 

April 22: Sting operation by Hashemi and U.S. Customs 
results in arrests of 17 U.S. and Israeli citizens for illegal 
arms sales. 

April 28: Bush-North operatives Albert Hakim and 
Thomas Clines go to Denmark to set up front companies to 
manage Iranian arms deals, and weapons transfers to the Con- 
tras and the Afghani mujahideen. They also arrange to buy a 
ship, the Erria. 

May: The ADL releases 10,000 copies of its Special Re- 
port: "The LaRouche Political Cult: Packaging Extremism." 

May 5: Maj. Gen. Richard Secord sends a coded message 
to Lt. Col. Oliver North at the NSC in the White House which 
reads in part, "Our man here claims Lewis has info against 

May 7: Wall Street Journal publishes "The Empire of 
Lyndon LaRouche," by Train salon operatives Pat Lynch and 
Dennis King. 

May 14-16: Adnan Khashoggi deposits $15 million in 
bridge financing into Enterprise Swiss accounts. 

May 22: FBI London sends a teletype to FBI in Washing- 

Rostock, and the goods had been sold by the East German 
trading company, IMES. The weapons were bound for the 
Nicaraguan Contras. 

July: Craig M. Williamson is appointed managing direc- 
tor of the GMR Group, South Africa. 

July: The Enterprise pays Defex $2.6 million and the 
Syrian Monzer Al Kassar $500,000 for Contra weapons 
shipped on the Erria; the arms are picked up in Poland and 
Portugal. When they are later unable to deliver the weapons, 
the CIA purchases them for $2. 1 million. 

July: A former DanishEAP member is interrogated about 
the EAP. The police interrogator already knew this person 
had been in the United States at the time of the Palme assassi- 

July 21: Cyrus Hashemi dies in London. 

Summer: Irwin Suall travels to Stockholm, to look into 
LaRouche' s operations there and to meet with Swedish inves- 
tigators. He gives the FBI a report on his findings. 

August: George Bush is appointed the chief of "Opera- 
tion Alliance," an anti-drug effort conducted with Mexico. 

October: North and Secord negotiate sale of 500 TOW 
missiles to Iran; Iran deposits $3.6 million into Enterprise ac- 

Oct. 5: A Contra supply plane is shot down over Nicara- 
gua. The pilot and co-pilot, Blaine Sawyer and William 
Cooper, who had been in Zaire the previous week delivering 
arms and supplies to UNITA, are killed; crewman Eugene 
Hasenfus survives, and is captured, and his debriefing by the 
Sandanista government is shown on American TV, launching 
the "Contragate" scandal. 

Oct. 6-7: 400 armed federal and state police raid the of- 
fices of companies associated with LaRouche in Leesburg, 
Virginia, with simultaneous indictments from the Boston 
grand jury against eight LaRouche associates. Millions of 
documents and financial records are seized. 

Oct. 20: At the arraignment hearing in Boston for the 
indicted LaRouche associates, the FBI case agent and prose- 

,j fUo r>„i. 

gation, in seized notebooks. 

Nov. 4: Boston LaRouche prosecutor discusses the note- 
book references by phone with the Swedish consular official. 

Nov. 7: FBI London sends a teletype to FBI HQ and 
Boston FBI, saying names of two U.S. citizens associated 
with LaRouche have "surfaced" as people who had "demon- 
strated against Olof Palme in Sweden in the past in concert 
with the European Labor Party. . . ." It asks FBI Boston to 
investigate this lead, but "to avoid past complications experi- 
enced in Washington, D.C., vis-a-vis using diplomatic or law 
enforcement channels, Boston should use . . . London as a 
conduit" to pass information to Swedish police rather than 
through Swedish diplomats in the U.S. 

Nov. 12: Defendant in the Hashemi arms sting seeks to 
subpoena George Bush. 

Nov. 17: Newsweek runs a story "Who Killed Olof 
Palme?" with references to LaRouche. 

Nov. 19: FBI Boston sends an airtel to the Terrorism 
Section at FBI HQ, asking Alexandria, Virginia FBI to look 
for the names of the two former EAP members from Sweden 
when reviewing seized records. 

Nov. 24: EIR's Washington office receives a call from 
NBC's Pat Lynch. Lynch says she had heard there are "many 
mentions of the Olof Palme murder in the notebooks" seized 
during the Oct. 6 raids. 

Nov. 25: "Iran-Contra" scandal created, when diversion 
of proceeds from Iran arms sales to fund Contras is revealed; 
the scandal diverts attention from ongoing investigations of 
drug-trafficking by Contra networks, and from U.S. arms 
shipments to Afghan mujahideen. 

Nov. 25: U.S. begins shipments of shoulder-fired Stinger 
anti-aircraft missiles to Afghan mujaheddin. 

Late November-early December: NBC's Lynch calls 
Boston LaRouche prosecutor to tell him "the Swedish author- 
ities" are coming, and want to look at notebooks seized in 
"the search of Oct. 6" at LaRouche offices. 

Dec. 3: Interpol Sweden asks through FBI London to 
review the documentary evidence seized during the Oct. 6 
search of LaRouche offices. 

Dec. 4: NBC Nightly News says seized notebooks contain 
details on the Palme murder, and Swedish authorities are in 
Boston to review the evidence. 

Dec. 4: A UPI wire goes out: "Swedish authorities are 
investigating whether extremist Lyndon LaRouche' s political 
organization had a role in the assassination of Swedish Prime 
Minister Olof Palme. . . ." 

Dec. 5: New York Times article, "LaRouche Documents 
Linked to Palme Case," which repeats the NBC line, but adds, 
"One official said it would take a 'quantum leap' to assume 
that the evidence provided a strong link. . . ." 

Dec. 5: An AP wire picks up the theme, but adds that the 
ADL's Irwin Suall went to Sweden to look into LaRouche' s 
operations there, and was questioned by a Swedish official 
after he returned to the U.S. 

Dec. 5: A UPI wire datelined Stockholm, "Police Dis- 
credit LaRouche Link to Palme assassination," quotes one 
police official, "Every time NBC or some other agency from 
the States calls us about this, we look at each other at police 
headquarters and say, 'Oh no, not again.' " 

Dec. 12: Steve Carr, a Contra mercenary based at the lohn 
Hull ranch in Costa Rica, who knew too much about drug 
shipments, and had talked about it to the Miami Herald in 
luly 1985, is found dead in Van Nuys, California. 

Dec. 19: Judge Lawrence Walsh is appointed as Iran- 
Contra independent counsel. 

1987 ~ 

January: Carl-Fredrik Algernon, head of Sweden' s ex- 
port control office, has fatal "fall" underneath a subway train, 
just before he is to testify before a government commission 
investigating illegal arms sales. 

Jan. 27-28: Soviet television airs a docu-drama called, 
"Who Killed Olof Palme?" and blames LaRouche for the as- 

February: Robert McFarlane, Reagan' s national security 
adviser from 1983 to the end of 1985, attempts to kill himself. 

Feb. 15: Swedish daily Aftonbladet reports on Russian 
docu-drama on Palme murder: "The film is part documentary 
and part speculation," and points to four groups as possibly 
responsible: 1) the EAP, 2) Chilean military junta, 3) neo- 
fascist rightist extremists, and 4) the "American intelligence 
service, CIA." 

Feb. 17: The state of Virginia arrests 1 7 LaRouche associ- 
ates in Leesburg, Virginia, on "securities" violations. 

Feb. 17: Aftonbladet reports the Soviet docu-drama ac- 
cuses the CIA of the murder; Svenska Dagbladet adds that the 
film claims that "the murder weapon was an American gun." 

March: LaRouche' s name surfaces at the Cini Founda- 
tion gathering in Venice, Italy, in the context of discussing 

March: Former Iranian President Abolhassan Bani-Sadr 
claims in an interview that Palme was killed because he had 
information that Iran bought weapons and paid with narcotics. 

March 17: A secondround of arrests of LaRouche associ- 
ates also on "securities" charges, this time issued by the State 
of New York. 

March 20: FBI London sends a teletype to FBI HQ re- 
questing cooperation for three National Swedish Police Board 
officials, who will come to the U.S. to interview 15 persons 
concerning the Palme assassination. 

March 21: General Giorgieri of Italy is assassinated by 
terrorists, in Rome. Later, Italian daily La Stampa links the 
murders of Palme, France's General Audran, and Giogieri, to 
illegal arms deals with Iran. 

March 23: A meeting of prosecutors in Virginia plans 
to file an involuntary bankruptcy action against LaRouche- 

78 October 1996 

EIR Special Report 

associated firms. 

April 7: A final planning meeting to execute the involun- 
tary bankruptcy is held, which includes prosecutors, and FBI 
and IRS agents. 

April 11: Per Gahrton, a former member of the Swedish 
Parliament writes a guest article in the Malmo-based Sydsven- 
ska Dagbladet, pointing to the Israelis as being possibly be- 
hind the murder of Palme. He refers to the Bofors affair, and 
Palme's mediator role in the Iran-Iraq War, saying that Israel 
may have wanted to get rid of Palme because he was an obsta- 
cle in the weapons sales to Iran, or because he was a good 
friend of PLO Chairman Yasser Arafat. 

April 14: FBI HQ sends a memo to eight FBI field offices 
and one unidentified location to notify them that three Swed- 
ish police officials will arrive on April 20 to conduct inter- 
views. It says "this much-publicized and high-priority investi- 
gation [which] will impact on the perceived prestige, 
competency and ability of the FBI," is to be handled by "ma- 
ture and competent" agents, and notes there maybe some ties 
to the Washington, D.C. assassination of former Chilean min- 
ister Orlando Letelier. 

April 19: Swedish radio charges that $50 million in kick- 
backs were involved in the Indian government' s contract with 
Bofors. Allegedly, bribes went to a secret Swiss bank account 
of top Indian government officials and Congress Party 

April 20: U.S. Attorney Henry Hudson in Alexandria, 
Virginia, files the involuntary bankruptcy petitions in court, 
ex parte, requesting authority to seize offices of three 
LaRouche-affiliated firms. 

April 20: Swedish police officials arrive in the U.S. 

April 20: AnAftonbladet story, "New Tracks in the Police 
Investigation — Main Track Is the EAP" reports the hottest 
investigatory trail is the so-called "police track": A group of 
policemen, under suspicion in the Palme murder, are tied 
to an international conspiracy, allegedly linked to the EAP, 
which Aftonbladet claims "has gone underground," while the 

able to the Swedish officials. 

April 23: An FBI agent goes with a Swedish official to 
Charlotte, North Carolina and Columbia, South Carolina to 
interview the two former EAP members, and to serve sub- 

April 23: A Svenska Dagbladet story, "EAP Woman 
Sought by Palme Investigators" reports that Ingvar Eriksson 
of the National Police says that, even though they will inter- 
view her, it is not a "hot trail." 

April 24: Expressen runs a picture of the house in North 
Carolina where the former EAP members live, alleging that 
the woman is hiding from police, and is married to American. 
In Ibero-America, two dailies, El Universal and El Financiero 
reprint an AP wire on the EAP's alleged connection to 
Palme's assassination. 

April 25: The Soviet daily Izvestia carries a TASS wire 
story, datelined Stockholm, reporting that investigations of 
the EAP alleged involvement in the Palme murder are contin- 
uing. It also reports the FBI's April 21 "raid on operations of 
the organization which form part of 'LaRouche's Empire.' " 

April 27: A meeting is held between Swedish officials 
and the LaRouche prosecutor and FBI agent in Boston, at 
which arrangements are made for one of the Swedes to go to 
New York to meet a confidential source about the LaRouche 

April 28: An FBI agent and Swedish official interview 
a confidential source, described as a former member of the 
LaRouche organization, who says he has "no direct knowl- 
edge concerning the assassination of Swedish Prime Minister 
Palme." Yet, it is his opinion that "if Lyndon LaRouche wan- 
ted .. . Palme assassinated, he would have the organization 
in Wiesbaden [Germany] do it. . . ." 

April 29: Oliver North's fundraiser, Carl "Spitz" Chan- 
nell, makes the first guilty plea in the Iran-Contra case. 

May 1: A Charlotte, N.C., FBI agent and Swedish police 
official interview the two former EAP members; the questions 
track information provided by the confidential source on 


to blame the U.S. for the assassination of Olof Palme — citing 
a videotape that asks: "Who killed Olof Palme? All roads lead 
to the CIA." 

May 8: hvestia cites an Aftonbladet report that PLO 
Chairman Yasser Arafat told two Swedish social democrats, 
with whom he had met in Algiers, that he knew who killed 
Olof Palme. No further details of Arafat' s assertions were 
conveyed, except that he allegedly said the key was to be 
found in Latin America. Aftonbladet, seconded by Izvestia, 
draws this out to hypothesize Chilean junta involvement. 

May 12: Olof Palme's widow, Lisbet, gives a new de- 
scription of the man who killed her husband. The police do 
not want to publish the description, but say they have given 
up the previously constructed pictures. The new description 
is of a man between 35 and 40 years old. 

May 26: Swedish prosecutor Stig Age begins the prose- 
cution of Mats Lundberg. 

May 31: The governor of the German state of Schleswig- 
Holstein, Uwe Barschel, is nearly killed in a suspicious 
plane crash. 

June 4: Two Swedish police officials, while questioning 
a former Danish EAP member, state they have been to the 
U.S. and questioned former members of the LaRouche orga- 

June- July: A political corruption scandal is launched 
against Uwe Barschel by members of the German Social De- 
mocracy, who are later found to be East German secret police 
moles, when the Stasi archives are opened in 1992-93. 

June 30: Lyndon LaRouche indicted by Boston federal 
grand jury. 

July 7-10, 13-14: Ollie North testifies before Congres- 
sional Iran-Contra hearings. 

Aug. 6: Aftonbladet reports that three Swedish police of- 
ficers from the Palme investigation were in the U.S. in April 
and, among other things, they looked at the EAP. The conclu- 
sion: The EAP track could be dismissed. 

Aug. 26: Heribert Apfalter, general director of the Aus- 
trian state-owned armaments company Voest-Alpina, dies, 
reportedly of a heart attack. He was scheduled to testify before 
the Austrian government commission of inquiry into Voest- 
Alpina artillery shipments to Iran. 

Sept. 1: Martin Ardbo writes in his diary that if Palme's 
role in the India-Bofors deal becomes public, the government 
will fall. 

Sept. 2: Italian authorities seize a Lebanese-chartered 
ship, Boustanyl, carrying millions of dollars worth of Soviet- 
and American-made weapons, plus large quantities of hashish 
and heroin. 

Sept. 4: Leading Italian industrialist Count Ferdinando 
Borletti and 30 others, are arrested on charges of manufactur- 
ing and illegally delivering hundreds of thousands of under- 
water mines to Iran. 

Sept. 26: Uwe Barschel resigns as governor of Schleswig- 

Holstein, after an "election irregularities" scandal. 

Oct. 10: Barschel tells friends that when he appears before 
a parliamentary investigative commission in two days he will 
"detonate a bomb," meaning he planned to tell what he knew 
about the illegal Iran arms deals. 

Oct. 11: Barschel is found dead at the Beau Rivage Hotel 
in Geneva, Switzerland. Autopsy reports found that he died 
in the evening hours of Oct. 10. The death is quickly ruled 
a "suicide." 

Oct. 11: Later-discovered files of the Stasi foreign intelli- 
gence section make references to one Ottokar Herrmann un- 
der the codename of "Rohloff '; and the last thing that is 
known about Uwe Barschel's mysterious Geneva trip 1987, 
is that he wanted to meet a certain "Rohloff," to find out 
about "unravelling evidence" concerning the "bombshell" he 
expected to create during the parliamentary hearings he was 
due to testify before on Oct. 13 in Kiel. Herrmann heads the 
firm INTRAC, which works in the dirty arms demimonde 
between East and West. He is also an ex-partner of EVIES 
head Schalck-Golodkowski. 

Oct. 12: Rashid al Jarrah of Saudi Arabia dies in Lugano, 
Switzerland, hours before he was to be handed over by the 
Swiss to the Italian authorities. His death was attributed to 
heart attack, although he was only 25 years old. Al Jarrah was 
part of an arms-trading ring that operated in Italy, Lebanon, 
and Yugoslavia. 

Oct. 30: Moscow's Sovetskaya Rossiya runs an article 
titled, "Fraudulent Tricks: Who Needed Fabrications About 
'Soviet Disinformation?' " by Mikhail Ozerov. He claims 
America is waging a disinformation campaign directed at 
Moscow. It lists four examples of unfounded charges, one of 
which deals with the Palme allegations. 

November: Karl-Erik Schmitz issues an angry press 
statement on allegations about his role in weapons trafficking 
to Iran in which he says, "Everyone has kept this secret until 
the Swedish Customs went around like an elephant in a porce- 
lain shop and destroyed it. Everywhere you go, it is the Swed- 
ish material that is the basis for investigation." 

Nov. 9: Hans- Joachim Knack, the undersecretary of the 
Interior Ministry of Schleswig-Holstein, dies, reportedly of a 
heart attack. He was to testify before a state parliamentary 
committee on the Barschel affair. 

Dec. 16: The first trial of LaRouche and his associates 
begins in Boston. 

Dec. 23: Shabtai Kalmanowitch is arrested by Israeli po- 
lice on charges he is spying for the Soviet KGB. 


During 1988: "Operation Lock" is founded by Prince Bern- 
hard and Prince Philip, as a hit squad within the World Wild- 
life Fund. 

80 October 1996 

EIR Special Report 

LV . , . : M 

March 10: Judge in the LaRouche trial in Boston case 
orders search of Vice President George Bush's files for any 
evidence that the "secret government" apparatus had spied on 
LaRouche. The judge's order is reported prominently in the 
Boston Globe and the Washington Post. 

March 16: North, former National Security Adviser 
Adm. John Poindexter, Secord, and Hakim are indicted for 
conspiracy, on the initiative of the Iran-Contra independent 

May 4: The Boston LaRouche case is declared a mistrial. 
Afterwards, the Boston Herald interviews jurors, who say 
that, from the evidence they have seen up to this point, they 
think the government was up to something fishy, and that they 
would have acquitted all defendants on all counts. 

The trial of the government' s involuntary bankruptcy pe- 
titions opens, lasting four days. 

August: Sheikh Salim bin Laden is killed in a plane crash 
in Texas. He was a board member of BCCI — the principal 
financing conduit for the Afghanistan War and arms ship- 
ments to the mujahideen. He was a cousin of Osama bin 
Laden, a principal financier of Afghansi terrorists to the pres- 
ent day. 

Oct. 14: LaRouche and six associates are indicted by an 
Alexandria, Virginia federal grand jury. 

Nov. 8: George Bush is elected President of United States. 

Nov. 21: The Alexandria federal trial of LaRouche and 
his associates begins. 

Nov. 29: Amiram Nir, counterterrorism adviser to Israeli 
Prime Minister Shimon Peres, and the only non-American 
member of Bush's Task Force on Combatting Terrorism, is 
killed in a suspicious plane crash in Mexico. 

Dec. 16: LaRouche and six associates are convicted in the 
Alexandria case. 

Dec. 21: Pan Am 103 blown up by bomb over Locker- 
bie, Scotland. 

Feb. 8: Alois Weichselbaumer, an Austrian arms dealer, 
dies, allegedly of a heart attack. 

Feb. 10: President George Bush convenes meeting of the 
National Security Council, having already decided that the 
United States will continue sending arms and ammunition to 
the Afghan mujahideen. 

Feb. 15: Soviets withdraw from Afghanistan; Afghan 
mujahideen factions begin fighting each other; Afghansis 
from other countries return to their homes, creating a world- 
wide terrorist network. 

Feb. 28: Col. Gerald Clarke, head of G-2 Army Intelli- 
gence for the U.S. Southern Command in the Panama Canal 
Zone, with oversight for the entire Caribbean and Central 
American region, dies. 

March 2: Court dismisses Boston indictments against 
LaRouche and others, over objections of LaRouche and other 
defendants, who demand a retrial. 

April 26: Karl-Erik Schmitz is asked by an EIR reporter 
about the existence of a vast secret, illegal, and "above gov- 
ernments" international explosives and arms cartel. Schmitz 
replies, "This is a well-established and international arms- 
trading system that has been in place and operating for de- 

May 4: Oliver North is convicted in a jury trial. 

August: Expressen runs a story pointing to a Soviet KGB 
role in the Palme assassination. 

Aug. 30: A Radio Moscow broadcast derides the Swedish 
mass media for a campaign claiming the Soviets knew in 
advance of plans to murder Olof Palme. It reports that the 
European Labor Party was the first to put this out. 

Aug. 31: A New York City Tribune story, "Did West Hide 
Soviet Role in Palme Slay Plot to Aid Detente? — Swedish 
Media Key on Bugging," reports: "Three members of Swe- 
den's secret police, SAPO, revealed this week that after bug- 
ging a Soviet envoy they discovered that the Kremlin had 
prior knowledge of Palme' s death and appeared to have been 
involved in the planning of it." The SAPO members leaked 







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Oliver North was George Bush's "gofer" in the most corrupt 
facets of the 1980s "secret wars" of the 1980s, including the 
flooding of the United States with cocaine to finance the Contras. 

LaRouche' s development proposals for eastern Europe. 

December: A letter written by the former Dresden Stasi 
head, Horst Boehm, reveals that Schalck-Golodkowski pre- 
ferred weapons deals in South Africa. Schalck-Golodkowski 
"defects" to the West, and enjoys the protection of the Bush- 
Thatcher networks. 

Dec. 20: President George Bush invades Panama with 
30,000 U.S. troops, killing an estimated 4,000 people, maim- 
ing thousands of others, and arresting Gen. Manuel Noriega. 


February: Former Dresden Stasi head Horst Boehm is 
driven to suicide, just after he has begun to reveal pieces of 
the Schalck-Golodkowski weapons-trafficking network. 

February: The director of the Rotterdam office of IMOG, 
the shipping subsidiary of Alexander Schalck-Golodkow- 
ski' s firm Deutrans, Mr. Lakowski, dies suddenly of a heart 

February: A Deutrans representative, Uwe Harms, dies 
under mysterious circumstances while in the Hamburg office 
of Deutrans' s partner firm, Richard Ihle. 

Feb. 21: Schalck-Golodkowski is flown to CIA headquar- 

ters in Langley, Virginia to be debriefed. 

Feb. 22: Former head of East German Stasi, Markus 
Wolf, flees to Moscow. 

Feb. 22: Tom Clines is indicted in the United States on 
tax charges related to the Iran-Contra investigation. 

March 22: Canadian scientist and arms dealer Gerald 
Bull is assassinated. Bull had been deeply involved in arms 
deals in Belgium. 

April 7: John Poindexter is convicted in a jury trial. 

July 20: Oliver North's conviction is vacated by Court 
of Appeals. 

Sept. 18: Tom Clines is convicted after a trial. 

1991 ~ 

Jan. 15: Bush-ordered bombing of Iraq begins. 

February: U.S.-led ground invasion of Iraq begins. 

Feb. 7: India's prime minister, Rajiv Gandhi, issues an 
open letter decrying the bombing of Iraq. 

Feb. 15: Rajiv Gandhi meets with EIR's India bureau 
correspondents, and voices his concern over the war against 
Iraq, and the political frame-up and incarceration of Lyndon 

Feb. 18: Rajiv Gandhi says India must stop permitting 
U.S. Air Force planes to refuel in India, in protest of the U.S. 
military operations against Iraq. 

Feb. 22: Rajiv Gandhi embarks on a diplomatic mission 
to Moscow, meeting with then-President Mikhail Gorbachov, 
and Iranian President Hashemi Rafsanjani, in an effort to end 
the war against Iraq. 

April: Detlev Karsten Rohwedder, head of the German 
agency in charge of economic integration of eastern Germany, 
is assassinated. The government of Chancellor Helmut Kohl 
abandons the LaRouche-Herrhausen economic development 
perspective toward the east. 

May 7: A Village Voice news short, "Palme Trick?" asks: 
"Were followers of jailed right-wing extremist cult leader 
Lyndon LaRouche behind the killing of Olof Palme? That 
possibility is suggested by a story in Dagens Nyheter, accord- 
ing to Friday's Guardian (U.K.). Olle Alsen, an editorialist 
for the Swedish daily, says an ex-French Foreign Legionnaire 
was offered $1 million for the hit by extremists affiliated with 
the [EAP] , as LaRouche' s troops call themselves in Sweden." 

May 21: Former Indian Prime Minister Rajiv Gandhi is 
assassinated while campaigning. 

July 18: Andre Cools, former deputy prime minister of 
Belgium, is assassinated. 

Late August: Prosecuting judge Jean Marc Connerrote, 
of Liege, who had built a case against two senior Liege politi- 
cians and several international organized-crime-linked ac- 
complices in the Cools murder, is removed from the case by 
Belgium's justice minister. 

Sept. 16: Case against Oliver North is dismissed because 

82 October 1996 

EIR Special Report 



* -v-* 

of complications created by Congress granting him immunity 
when he testified in 1987. 

Nov. 15: John Poindexter's conviction is vacated by ap- 
peals court. 

1992 ~ 

Feb. 20: A New York Times story, "Six Years Later, Olof 
Palme Street Keeps Its Secret," draws an analogy between 
the investigation of Palme' s murder and the coverup of Ken- 
nedy's assassination as portrayed in the film "JFK." 

May 25: Tom Clines begins serving a 16-month prison 
sentence in the United States. 

June 16: Former U.S. Defense Secretary Caspar Wein- 
berger is indicted. 

Aug. 20: Journalisten magazine, published by the Swed- 
ish Journalists Association, carries the explosive revelations 
of a former Stasi agent. Titled, "He Laid Wrong Tracks Con- 
cerning the Palme Murder," it reports that former East Ger- 
man Stasi agent Herbert Brehmer revealed he was assigned 
to plant "false tracks in the hunt for the murderer." Brehmer 
"was a specialist in the art of deceiving credulous Western 
journalists. . . . His profession: disinformation officer at the 
Stasi Department X in East Berlin." 

Nov. 6: Bill Clinton defeats George Bush in U.S. Presi- 
dental election. 

Nov. 6: Associated Press issues a wire datelined Stock- 
holm, with the headline, "Palme 'Was CIA Target,' " report- 
ing that the Swedish national TV program "Norra Magasinet" 
interviewed Ivan von Brichan, who claimed that CIA agent 
Charles Morgan offered him $2 million in 1986 to kill Palme. 
The TV program reported that the "CIA wanted Palme dead 
because he was a potential candidate for United Nations secre- 
tary general, an appointment contrary to U.S. interests." The 
article provides this background: "The Yugoslavian-born von 
Brichan, a Swedish resident since 1976, met Morgan in the 
1970s in Africa. Von Birchan was a mercenarv in Rhodesia 

killers" and/or networks within the Swedish police itself. It 
also says that OUe Alsen, a retired writer for Dagens Nyheter 
who has done his own investigation of the Palme murder, 
believes a link with "Gladio" — the secret NATO network to 
defend Europe in the event of a Soviet invasion — must be 
pursued. Alsen' s scenario has the murder done by a former 
Foreign Legionnaire with links to the "neo-Nazi" EAP. An- 
other scenario puts a group of Swedish police officers with 
EAP links at the center of the plan. 

April 28: L'ltalia publishes article, "Who Killed Olof 
Palme?" It says the deed had to be done with international 
cooperation at "such high and 'classified' levels as to be unat- 
tainable by the police of a small nation like Sweden." In mak- 
ing its case, the article points to Emma Rothschild, who 
"evaded the investigation," to a telegram which Licio Gelli 
allegedly sent two or three days before the crime to U.S. 
Republican Party figure Philip Guarino, to the American "se- 
cret" government identified in the Iran-Contra investigation, 
and to NATO circles (or rather, networks analogous to the 
Italian "Gladio"). 

August: Israel and the PLO announce peace accord in 

Sept. 3: It is reported that former Swedish criminal in- 
spector Bone Wingren will soon release a book on the Palme 
murder in which he reportedly revives the Viktor Gunnarsson 
angle. Wingren was the policeman who interrogated Gun- 
narsson in 1986. 

Sept. 4: Viktor Gunnarsson, in an interview, says he was 
investigated by police one week before the Palme murder. He 
maintains his innocence, and claims he was the scapegoat for 
a murderer known to the police leadership. He charges that 
Bbrje Wingren was manipulative and falsified protocols of 
the interrogation, and that he had shown pictures of Gunnars- 
son to the witnesses before they were asked to identify the 
supposed killer in the lineup. Gunnarsson says he could no 
longer stay in Sweden, since "the authorities have destroyed 
my life," and so he now lives in the United States. 

SeDt. 11: Henrv Kissineer tells CBS News that anvone 



Jan. 7: Viktor Gunnarsson' s body is found, with two bul- 
let holes in the head, in a North Carolina woods. 

Jan. 26: Lyndon LaRouche is released from federal 
prison, on parole. 

February: Baruch Goldstein, a Jewish settler, enters a 
mosque in Hebron on the West Bank and kills 50 Muslim 
worshippers, to protest the peace accords. 

Feb. 3: Sweden's Gothenburg Post lists seven "tracks" 
in the Palme murder investigation which now have been 
"thrown out" by Olvebro's team. Among the seven "tracks" 
which will not be further investigated, are the EAP, PKK, 
Iran, and the Bofors affair. 

Feb. 19: Expressen prints story headlined "The Witness 
Points Out His Group," subtitled "The Police Hunting Palme 
Hater(s) for the Murder." It reports that the murderer is now 
being sought among a group around the medical doctor Alf 
Enerstrom, who conducted a violent hate campaign against 
Palme. Enerstrom is quoted, "It is a lie that I would have used 
the money for some dirty deals . I understand that [some] want 
to insinuate the money could have been used ... to finance a 
murder plot. I can say that I gave 1 million crowns to the EAP. 
Its orientation against Palme was the same as ours. But I don't 
know how the EAP used the money." 

Feb. 25: Corriere della Sera story, "Weapons and Bribes: 
The Palme Mystery," subtitled "India-Sweden: Mega-Scan- 
dal Over Weapons," reports: "An international scandal, 
which the Swedish authorities have tried to avoid for years, 
is on the verge of exploding, triggered by a decision of the 
Swiss government." The Swiss government is to give Indian 
police hundreds of banking documents on the sale of Bofors 
howitzers to India. 

March 10: Expressen writes that Ulf Aasgaard, apsychia- 
trist and police physician, believes that Lisbet Palme might 
have made a mistake concerning Christer Pettersson (who 
was identified by Lisbet Palme as the murderer, but later freed 
by the Court of Appeals). Aasgaard was with Olvebro in the 
United States, meeting with the FBI to check his own work 
on profiling the killer. 

March 28: Corriere della Sera runs a story on the Palme 
assassination reporting that 95% of the leads can now be dis- 
carded. Some on that list are, "Ayatollah Khomeini and Sad- 
dam Hussein . . . Pinochet, the South African government, 
the Croatian Ustashi, the German terrorists, the KGB and 
NATO, or even SAPO, the Swedish secret service, or the 
Black Rose, a mysterious right-wing organization." Men- 
tioned later is the Gunnarsson-LaRouche-EAP angle. It con- 
cludes by raising the Swedish "Irangate," Bofors, and the 
Stasi, as still a possible investigative track. 

April 2: U.S. Anti-Defamation League National Chair- 
man Abraham Foxman, in a statement to the Jerusalem Post, 
condemns Prime Minister Yitzhak Rabin for interfering with 

ADL's efforts to force the Clinton administration to say that 
East Jerusalem must be a part of Israel. 

April 27: A Swedish national TV program on the Palme 
assassination interviews Stig Johansson, working for SAPO 
as an expert on fringe groups, who was asked why the SAPO 
had done nothing to stop the EAP. He answered that there 
had been no reason, since the SAPO had found the situation 
concerning the EAP to be under control. 

May: Noted Swiss pathologist Dr. Hans Brandenberger 
produces tissue samples from Uwe Barschel's body, showing 
he had been drugged prior to his death. 

June 17: German TV-1 reports that some Swedish inves- 
tigators who wanted to pursue the "right-wing extremist" and 
"right-wing extremist police" tracks, believe that Swedish 
Police Chief Holmer covered these up, in order to go after the 
Kurdish track. This "Kurdish" track supposes that the Iranians 
hired PKK Kurds to kill Palme, because Palme was moving 
against Bofors-Iran arms deals. 

June 21 : Germany ' s Der Spiegel reports that the Schalck- 
Golodkowski weapons trail leads to Sweden. 

July-August: Worth magazine publishes an eight-page 
libel of LaRouche. The financial columnist for the magazine 
is John Train. 

Oct. 5: Various German media break the story of Dr. 
Brandenberger' s report on the drugging of Barschel. 

Oct. 13: Bernd Schmidbauer, German Chancellor Helmut 
Kohl's chief national security aide, tells reporters, "Maybe 
Barschel was assassinated, after all." He then orders a full 
review of the Stasi archives for any evidence of East German 
involvement in the Barschel murder. 

Dec. 21: The Barschel case is officially reopened by the 
Schleswig-Holstein state court in Liibeck. Prosecutor Hein- 
rich Wille is appointed to head the investigation. Wille is 
the only person who did not accept the official finding that 
Barschel' s death was a "suicide." Six days later, the investiga- 
tion is expanded to include the May 1987 plane crash that 
almost killed Barschel. 

Dec. 24: The Frankfurter Allgemeine Zeitung reports a 
possible "arms cartel" link to the Barschel case. A former 
Stasi officer's report to West German security agencies says 
that voluminous arms and technology deals went on with the 
help of Schalck-Golodkowski and West German enterprises, 
"potentially including reputable firms in Schleswig-Hol- 
stein." It says that on the day he died, Barschel may have met 
with "arms dealers with Iranian backgrounds." It also cites 
a telegram attributed to a CIA officer, reporting a meeting 
attended by five persons on the evening of Oct. 10, 1987. One 
attendee who "was given the codename of 'Perch,' is said to 
have categorically rejected any cooperation." ("Perch" is the 
English word for "Barsch," as in Barschel.) 

Dec. 26: Germany's Bild Zeitung elaborates the Barschel- 
Iran story, in an article, "Barschel: CIA Agents Were Hanging 
Around at the Death Hotel." Two days later, the paper reports 
that the details on Barschel' s Geneva meetings the day of his 

84 October 1996 

EIR Special Report 


death were given by the German federal intelligence service 
BND to judges in Liibeck in 1992. 


Jan. 8: Klaus Klinger, the justice minister of Schleswig- 
Holstein, reports in an interview on German radio, that at least 
200 pages of Stasi files relating to the Barschel case have been 
shredded by West German counterespionage agents. 

Oct. 5: Following Israeli Prime Minister Rabin's trip to 
the United States, where he came into conflict with the ADL 
and others, the Israeli daily Yediot Aharonot runs a story: 
"Rabin Against the Jews." Over the month, other papers in 
the United States and Israel print ever shriller denunciations 
of Rabin, one even calling him a traitor. 

Oct. 10: Aftonbladet reports that Palme's private tele- 
phone was tapped. It reveals a secret memo, delivered to the 
Palme Commission on July 14, written by an "expert on mili- 
tary intelligence," claiming that Palme and Emma Rothschild 
spoke to each other on the day of the murder. "Rothschild was 
informed where the Palmes intended to go" that evening. 

Oct. 18: Siiddeutsche Zeitung reports that Schalck- 
Golodkowski has just headed a 14-person "trade" delegation 
to China. 

Oct. 20: NATO Secretary General Willy Claes resigns, 
allegedly over the Agusta helicopter scandal in Belgium, tied 
to the Socialist Party. 

Nov. 4: Israeli Prime Minister Yitzhak Rabin is assassi- 
nated in Tel Aviv. 

Nov. 5: Swedish TV-3 airs a program on the Palme assas- 
sination, asking whether any foreign intelligence service 
would have benefitted from the death of Palme. The Mossad, 
CIA, and KGB all deny it. The conclusion of the show, is that 
the murder was done by a "clumsy amateur." 

Nov. 7: Sweden's Prime Minister Ingvar Carlsson issues 
a statement on the Rabin assassination, in which he refers to 

bladet. He writes that publishing the Carlsson statement was 
irresponsible in light of the well-known fact that "Warsaw 
Pact intelligence services linked to Boris Pankin concocted a 
scheme. . .through a relevant unit" of the Stasi to fraudulently 
"implicate" him in the Palme assassination. LaRouche says 
that Carlsson' s statement "pollute[s] the memory of the mar- 
tyred statesman, Yitzhak Rabin." 


March 11: Svenska Dagbladet reports that a documen- 
tary on the Palme murder was censored. "At the last minute, 
French sources demanded that the interview with Carl Lid- 
bom, who, at the time of the Palme murder, was Swedish 
ambassador to Paris, had to be cut out. It was said that this 
happened after pressure from Swedish sources. According to 
the German producer, the part of the film which was cut out 
contained information about what Lidbom and Holmer had 
been doing the night that the murder took place." 

Aug. 17: Belgian police rescue two young girls being held 
captive by pedophile Marc Dutroux. Within weeks, over 30 
arrests, including of senior police and judicial authorities, are 
made, and a direct link is uncovered between the Dutroux 
case and the 1991 murder of Andre" Cools. 

Aug. 18: TheSan/oseMercwryAfewsinCaliforniabegins 
a series on the links between the Contras and the crack cocaine 
epidemic in the United States, triggering an uproar initially 
aimed at the CIA, but increasingly directed at George Bush 
and his secret government. 

Sept. 8: Former president of the Gothenburg Court of 
Appeals, Erik Holmberg, calls for a serious investigation into 
the "Stay-Behind-Movement" ("Gladio") for its possible 
involvement in the Palme assassination. Holmberg writes an 
article, "Hope for an Honest Analysis of the Palme Murder," 
published in Svenska Dagbladet, in which he claims that the 
chief of the Swedish National Police in 1986, Holger Ro- 
mander, had planned to investigate it back in August 1986. 


A Very Thin Line — The Iran-Contra Affairs, by Theodore 
Draper (New York: Simon and Schuster, 1991). 

American Leviathan: Administrative Fascism under the Bush 
Regime (Wiesbaden: Dinges & Frick, 1990). 

Blank Check: The Pentagon 's Black Budget, by Tim Weiner 
(New York: Warner Books, 1990). 

Bull 's Eye — The Assassination and Life of Super gun Inventor 
Gerald Bull, by James Adams (New York: Times 
Books, 1992). 

Contraband — South Africa and the International Trade in 
Ivory and Rhino Horn, by De Wet Potgieter (Capetown, 
South Africa: Queillerie Publishers (Pty) Ltd., 1995). 

Defeat Ollie North, That Son-of-a-Bush (Leesburg, Virginia: 
Defeat that Son-of-a-Bush Committee, August 1994). 

EIR, "The Coming Fall of the House of Windsor," Oct. 28, 

EIR, "New Terrorism International Targets South Asia," Oct. 
13, 1995. 

EIR, "British Monarchy Rapes the Transcaucasus — Again," 
April 12, 1996. 

EIR Special Report: "A Classical KGB Disinformation Cam- 
paign: Who Killed Olof Palme?" (Wiesbaden: Dinges & 
Frick, 1986). 

EIR Special Report: "Project Democracy: the 'Parallel Gov- 
ernment' behind the Iran-Contra Affair" (Washington, 
D.C., 1987). 

EIR Special Report: "Treason in Washington: New Evidence 

on the 'October Surprise' " (Washington, D.C., Febru- 
ary 1992). 

EIR Special Report: "Would a President Bob Dole Prosecute 
Drug Super-Kingpin George Bush?" (Washington, D.C., 
September 1996). 

Final Report of the Independent Counsel for Iran/Contra Mat- 
ters, vols. 1-3 (Washington, D.C.: United States Court of 
Appeals for the District of Columbia Circuit, Aug. 4, 

Honored and Betrayed — Irangate, Covert Affairs, and the 
Secret War in Laos, by Richard Secord (New York: John 
Wiley and Sons, 1992). 

Iran-Contra Affair (Washington, D.C.: Report of the Senate 
and House Committees [Senate Report No. 100-216, 
House Report No. 100-433], and depositions thereto, No- 
vember 1987). 

Thatcher's Gold — The Life and Times of Mark Thatcher, by 
Paul Halloran and Mark Hollingsworth (London: Simon 
& Schuster Ltd., 1995). 

The Franklin Cover-Up, Child Abuse, Satanism, and Murder 
in Nebraska, by John W. DeCamp (Lincoln, Nebraska: 
AWT, Inc., 1992). 

Tiny Rowland, the Ugly Face of Neocolonialism in Africa, by 
an EIR Investigative Team (Washington, D.C.: EIR, 

Under Fire, by Oliver North and William Novak (New York: 
Harper, 1991). 




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Montreal 1700 

Moscow 0100* 

New Delhi 0330* 

New York .... 1700 

Nogales 1500 

Norfolk 1700 

Oslo 2300 

Paris 2300 

Philadelphia .... 1700 

Pittsburgh 1700 

Prague 2300 

Rangoon 0430* 

Richmond .... 1700 
Rio de Janeiro . . . 1900 

Rome 2300 

St. Louis 1600 

St. Petersburg . . . 0100* 
San Francisco . . .1400 

Santiago 1800 

Sarajevo 2300 

Seattle 1400 

Seoul 0700* 

Shanghai 0600* 

Singapore 0530* 

Stockholm 2300 

Sydney 0800* 

Teheran 0130* 

Tel Aviv 2400 

Tokyo 0700* 

Toronto 1700 

Vancouver .... 1400 
Vladivostok .... 0800* 

Venice 2300 

Warsaw 2300 

Washington .... 1700 

Wellington 1000* 

Wiesbaden 2300 

Winnipeg 1700 

Yokohama 0700* 

Yorktown 1700 

* Mondays 

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About Economics? 


A President Bob Dole 

This EIR Special Report documents the crucial issue 
of the 1996 U.S.A. general election campaign: the 
ongoing war between U.S. President Bill Clinton and 
the Queen's Own Republican Party of 1980s drug 
super-kingpin George Bush. 

116 pages $100 
Order #EIR 96-003 

Order from: 

EIRNews Service p.o. Box 1 

7390 Washington, D.C. 20041-0390 

Chapter 1 . 

Drug Kingpin George Bush 

The Contra "crack" connection. 

Chapter 2. 

George Bush: The Cop 

Who Committed the Crime 

Vice-President George Bush's spe- 
cial titles (Drug Czar and Special 
Operations Czar of the 1980s). 
The Bush-League of the 1980s: 
Don Gregg, Oliver North, Ted 
Schackley, Richard Secord, Felix 

Chapter 3. 

Under the Joint Chiefs of Staff: 

The 'Focal Point' 

Is there life on the "Asteroids"? 
Privatizing the Secret 
Government." Bush and the 
LaRouche case. Bugsy Bush, Dirty 
Ollie, and the case of Michael 
Billington. Ollie's not-so-secret 
Channel to the drug-runners. 

Chapter 4. 

The Truth About Mena, 

Arkansas . . . and beyond 

The intermountain airport, and 
its uses. Barry Seale, and the Tale 
of the two Ollies. Who really 
killed DEA agent Camarena? 

Chapter 5. 

The Defense Department 

Makes a Deal With Drug Lords 

LaRouche and "Operation 
Guatusa." How Bush's war 
against General Noreiga turned 
Panama over to the Cali cocaine 
cartel. The case of Mexico. 

Chapter 6. 

What Was the Cover-Up in 

Pan Am 103? 

Chapter 7. 

Terrorism Against President 

Clinton's U.S.A. 

Chapter 8. 

The International Terrorist 

Threat to the U.S.A. Today 

Chapter 9. 

A 'Kingpin' Indictment of 

George Bush et al.